Chapter 13 bankruptcy allows people to keep their assets while a reorganization plan is created in order to better handle the debt in question. Debt is usually repaid within a 3 to 5 year period. According to FHA guidelines, with a Chapter 13 bankruptcy the lender must document that at least one full year of satisfactory and on time payments has passed. The borrower must have written permission to enter into a mortgage transaction from the bankruptcy court. The documentation must also show that a minimum of two years have passed since the discharge of the Chapter 13 bankruptcy.

When using FHA to buy a home after bankruptcy, borrowers should be prepared by having their bankruptcy and discharge documents ready and available for the lender. Since many of these debts continue to appear on credit reports after a discharge, the lender will need to update and correct the credit report prior to mortgage approval. The process of obtaining an FHA mortgage under these circumstances is not stressful and should not keep anyone from purchasing a home.

FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders’ rate sheets to determine the most accurate mortgage rates available to well qualified consumers at a standard .07 to 1% point origination fee.

The new year might be bringing in fresh optimism for the housing market. Results are in from the Mortgage Bankers Association’s Weekly Applications Survey, which imply a modest pickup in applications and sales.

Don’t Miss: Bernanke to Congress: We Need Your Help to Revive Housing.

Other Survey items tend to confirm the above implications: refinance activity in the first week was down about 1 percent, and adjustable rates were up to 5.4 percent from 4.7 percent the week before. The former can be interpreted as less concern among home owners over their ongoing interest rates, and the latter as less fear of volatility in the mortgage market, in that buyers were willing to accept loans on that condition.

Other rate changes involved long and short term fixed-rate mortgages. 30-year loans with conforming balances ($417,500 or less) had contract rates increasing from 4.07 percent to 4.11 percent, with points decreasing, while rates for jumbo loan balances ($417.500 or more) saw the opposite change. This could indicate that those buyers with lower incomes are less wary of long run adverse economic conditions, assuming there was no institutional need for rate hikes.15-year fixed rate loans showed the same rate increase, but FHA backed mortgages saw their rates unchanged.

This week’s numbers could be only a spike, but if this trend continues into the rest of January and farther, it could imply higher confidence in the economy, as homes are usually the largest expenditures in most people’s lifetimes. That makes these statistics into a highly accurate economic barometer, and one well worth watching.

Demand for loans to buy homes and refinance mortgages slid in the final week of 2011, even as mortgage rates dipped, an industry group said on Wednesday.

Average 30-year conforming mortgage rates dipped to the year's low of 4.07 percent from 4.10 percent the prior week, and well below 4.82 percent at the end of 2010.

The slide to near-record-low borrowing rates has spurred more homeowners to seek refinancing, propelling that index up more than 60 percent in 2011.

But demand for loans to buy homes fell in the year, as borrowers struggled to come up with enough cash for down payments or stayed on the sidelines due to worries about unemployment. Some buyers had also leapt into the market in 2010 to take advantage of a first-time buyer tax credit.

The MBA said it does not expect any quick rebound in the mortgage market.

"As part of legislation to extend the payroll tax holiday, guarantee fees for loans purchased by the GSEs and mortgage insurance premiums for FHA loans will eventually increase," Michael Fratantoni, MBA's vice president of research and economics, said in a statement. "Given the announced implementation of this change, we do not expect to see an impact on mortgage rates and application activity until at least February."

Bob Moulton, president of Americana Mortgage Group in Manhasset, New York, said the company's pipeline of loan requests is off to a better start in 2012 than the same time a year ago, boosted by refinancing.

But caution prevails with a big overhang of unsold homes and the presidential election looming, he said.

Refinancing applications represented about 82 percent of total mortgage activity in the latest week, the highest share of the year.

"It's going to be another couple of years until these short sales and foreclosures are flushed out of the system, so you might see a little weakness in prices this year," Moulton added. "We're feeling a little better about 2012 than 2011, but you're always waiting for the next shoe to drop."

The MBA released data for two weeks on Wednesday, rather than one, because of the Christmas and New Year holidays.

In the week ended December 23, total mortgage demand climbed 0.3 percent, with refinancing up 0.5 percent and purchase applications down 0.1 percent.

The survey covers over 75 percent of U.S. retail residential mortgage applications, according to MBA.

Navy Federal offers other mortgages to choose from, like an FHA, which is available as a fixed-rate or an Adjustable Rate mortgage (ARM). An ARM may be ideal for those planning on moving frequently or expecting an increase in income while in the military. Mortgage loan programs through Navy Federal Credit Union provide flexibility, variety and personal service.

Owning a home has never been easier for family of and those who serve in the military. Mortgage loans with Navy Federal Credit Union supply a range of options to meet the unique needs of our country's servicemen and women. With great rates and personal guidance, Navy Federal Credit Union has made home buying within your reach.

Members can also receive additional tips and resources on deployment and PCS by joining today. More information and membership details can be found at the Navy Federal Credit Union website: http://www.navyfederal.org .

Verification of available assets for down payment funds and reserves is also necessary. Borrowers interested in a home purchase will find that these low mortgage rates along with low home prices is making the monthly mortgage payment much more affordable. For existing homeowners

Bergen County NJ Real Estate - Ossining Real Estate - Ardsley Real Estate -

Economic racism is a slippery thing in 2011. It's not out in the open, like a "whites only" sign above a lunch counter. And it's not explicit, like the deed to a house barring its sale to blacks or Jews.

Instead, it's submerged. It lives in patterns of discrimination hidden within reams and reams of hard to analyze data. It's not necessarily driven by animus or hate. Sometimes it's just a product of garden-variety greed.

The 45-page complaint that accompanies the settlement may be one of the most extensive studies of housing discrimination ever completed in this country. The court papers outline what Justice investigators found when they analyzed 2.5 million mortgages Countrywide issued between 2004 and 2008. Bank of America, which bought the enormous mortgage lender in 2008, has not admitted or denied any of the government's alleged facts.

Here is the ugly story made brief. According to Justice, Countrywide overcharged more than 200,000 black and Hispanic borrowers for their loans. About 10,000 were sold risky subprime mortgages, even though their finances were good enough to qualify for cheaper prime rates. Black customers who obtained their mortgages through a Countrywide-affiliated broker were more than twice as likely to get a subprime loan than similar white borrowers. In some markets, they were as much as eight times more likely.

The government argues that Countrywide's internal data monitoring should have tipped management off that discrimination was occurring. But the company did nothing until 2008, when regulators forced its hand. At that point, it only compensated a small number of the customers who had been cheated.

We can't know the motives of each and every Countrywide employee responsible for such a systemic failure. But we can know the circumstances they were working under. In those circumstances, discrimination was profitable.

Countrywide's employees were paid extra commissions to hand out more expensive mortgages. Brokers could earn fatter fees for convincing borrowers to take out an exotic subprime loan than for a plain-vanilla 30-year-fixed mortgage. And of course, the more borrowers paid in interest and fees, the more money Countrywide made.

Everyone involved with the company, from the executives on down, had an interest in hawking the most expensive loans they could. And sadly, minorities were the go-to targets for that kind of predatory lending. For years, black and Hispanic families in America had little access to credit. As Ellen Schloemer of the Center for Responsible Lending explained to me, that meant many of them had little familiarity with complicated financial transactions, such as taking out a mortgage. During the housing bubble, their inexperience made them an easier mark for unscrupulous lenders, especially if they spoke little English.

It shouldn't be a surprise then that two-thirds of the victims Justice identified were Hispanic.

Greed fueled a system that created a pattern of racial bias. No, it's not as overt as old fashioned "redlining," where bank executives flatly refused to lend in black neighborhoods. But that doesn't minimize Countrywide's actions. It makes them more insidious, because they're harder to detect.

To get the most favorable valuation of your residence, there's no need to do a major home addition or pay for expensive renovations. Instead, focus on three low-cost solutions: cleaning, basic home maintenance and minor upgrades.

Create a great first impression by cutting your front grass, de-cluttering all rooms and thoroughly cleaning your home. If your last paint job was done back in the 1990s, a fresh coat of paint (in a neutral color) wouldn't hurt either.

Also, attend to things like leaky faucets or problem toilets. Consider changing bathroom rugs and shower curtains for a fresher appearance. If your kitchen is older, try installing new handles and doorknobs on cabinets and doors to create a more updated look.

All of these quick fixes can help your home achieve a higher appraised valuation.

A higher property value aids your mortgage refinancing efforts in several ways. For starters, lenders will use your property appraisal to calculate your loan-to-value (LTV) ratio. Additionally, if your loan amount is 80% or lower than your current property value, you won't have to pay Private Mortgage Insurance.

But even without an 80% LTV ratio, realize that mortgage lenders have other options, such as 90 LTV loans, which carry favorable interest rates and can also save you money on your current mortgage rate.

As Aaron and Henry discuss in the accompanying clip, owning a home is now more affordable than any time in the last 15 years, based on a new Wall Street Journal survey. In fact -- with the average price of a home $242,300 -- it is now cheaper to own than rent in 12 metro areas including Atlanta, Chicago, Detroit, Las Vegas, Miami, Orlando and Phoenix.

As the WSJ article points out, the discrepancy between buying and renting can be extreme in some areas:

"In Atlanta, which had the most favorable values for owning versus renting, the monthly payment on the average home was $539 assuming a 20% down payment during the third quarter. By contrast, the average asking rent stood at $840."

Sagging prices and sub-4% interest on a 30-year fixed mortgage are the biggest drivers behind the trend of record housing affordability. However, unlike the glory days when buying a home merely took a pulse, securing a loan today is much tougher. And, flipping property is a dead game.

The companies were accused of knowingly and repeatedly violating the Servicemembers Civil Relief Act, a federal law that extends an array of financial and legal protections to military personnel. Specifically, the companies were accused of ignoring a provision of the law that required them to get court orders before foreclosing on active-duty service members.

Without admitting wrongdoing, the former Countrywide unit agreed to pay $20 million to approximately 160 victims of illegal foreclosures from January 2006 to May 2009. It also agreed to reimburse victims of any other illegal military foreclosures found to have occurred from May 2009 to the end of last year.

Further, it promised to upgrade its training and report future violations of the civil relief act to the Justice Department.

Although most of the improper foreclosures began before Bank of America acquired Countrywide, “it is our responsibility to make things right,” said Terry Laughlin, an executive vice president at the bank. He added, “These errors are not acceptable, and we certainly regret them.”

According to Thomas E. Perez, assistant attorney general for the Justice Department’s civil rights division, the Countrywide settlement is “easily the largest amount ever recovered“ by the Justice Department for violations of the civil relief act.

Saxon was accused of illegally foreclosing on approximately 18 service members, “some of whom were severely injured in the line of duty or suffer from post-traumatic stress disorder,“ according to Mr. Perez.

Without admitting wrongdoing, Saxon agreed to pay $2.35 million to victims of those foreclosures, made from January 2006 to May 2009. It also agreed to pay the victims of any subsequent wrongful military foreclosures, through the end of last year, and to upgrade its training programs.

“First and foremost, we want to apologize to those military families that were affected by any mistakes made in the foreclosure process,” said Mark Lake, a spokesman for Morgan Stanley. “Our servicemen and women deserve the highest level of customer service.”

He said that Saxon “has taken meaningful steps to ensure it has appropriate policies and procedures in place to comply fully” with the civil relief act.

Both companies agreed to repair any damage their improper foreclosures had caused to the credit scores of the affected homeowners.

There have been widely publicized violations of the civil relief act since well before January 2006, the starting date for these settlements. Indeed, the Saxon investigation was based on a complaint by Sgt. James B. Hurley, an Iraq veteran who lost his home in western Michigan in an improper foreclosure in 2005. Saxon and its co-defendant in that case, Deutsche Bank, reached a confidential out-of-court settlement with the Hurleys early this year.

Mr. Perez said the 2006-9 period was chosen because it encompassed the sharp spike in national foreclosure activity that began in late 2006.

The settlement terms expand that window to the end of 2010.

The two mortgage companies have set up a direct hot line for service personnel who believe they are eligible for relief under the settlements. That number is (800) 896-7743, mailbox 6 for the former Countrywide unit and mailbox 995 for Saxon

Epstein, who calls it "a failure of crapitalism," makes a quite simple point. When the government guarantees, or seems to guarantee, losses, the "behavior of private actors gets fatally distorted," says Epstein.

Mortgage firms and banks, as well as individual homeowners, take undue risks, knowing the taxpayer will stand behind their mistakes. If they are right, they make a big profit. If they are wrong, we will bail them all out. This is, in Epstein's words, "Heads I win, tails you lose."

It seems logical to think that government should not be underwriting everyone's mortgages, but since the financial meltdown, things have actually gotten worse, not better. With banks nervous about lending and with tens of millions of homeowners underwater, more than 90% of all mortgages are being guaranteed by the government - and that means by you and me.

Further, in the past Fannie and Freddie were only quasi-government agencies. But now that we have bailed them out they are actually part of the government - which means that we, the taxpayers, are financing more than 90% of all mortgages and covering the losses of anyone who is underwater.

With the government guaranteeing mortgages, home values have become artificially inflated. You may think home prices are attractive, but if the government stopped guaranteeing 90% of all mortgages, they would be lower.

Without government guarantees, banks would have to tighten their standards. They would raise rates, demand higher downpayments, and require stiffer income tests. This means housing would be much less affordable than it is now.

One way or another, the President and Congress will have to start looking for ways to wean government from the housing market. Government can't go cold turkey. If it stops its guarantees, values will come crashing down, plunging the country into an even more severe financial crisis. The poor and lower middle class will be especially hurt, and this will be politically and economically untenable.

However, it is not a question of if, but rather when and how the government cuts back on its support of housing. My guess is that it will be a gradual process, perhaps taking a decade to get banks and mortgage brokers to take up most of the slack. During that time, the housing market will be under pressure.

While housing prices have come down, they are still well above their inflation-adjusted average for the period since 1970, and if the government is going to have to get out of the mortgage business, prices could drop below their trend line.

So what does this mean for you? If you have a good balance sheet, this could be a good time to take out a new mortgage. One way or another, rates will start to creep up. Do not speculate on housing as an investment. Prices may have come down, but there are millions of homes underwater and the government will have to get out of the business of guaranteeing losses. So in my view, there is more downside.

Companies operating rental properties will do relatively better, as home ownership declines. However, given the overhang of underwater properties, I am not buying these stocks. Home builders are still vulnerable, because they have to compete with distressed sales.

I am also concerned about companies that cater to the home market or the consumer, especially the middle to lower end. With tougher mortgage standards, people will not be able to pull money out of their homes to build pools or finance renovations.

Housing prices have come down, but with 90% of all mortgages guaranteed by the government, there will be more pain before we solve, in Epstein's words, our failure of crapitalism.

Your Money columnist Peter Siris is an investment manager at Guerrilla Capital in Manhattan.

‘Our research indicates just how many potential first-time buyers are not making it to the application stage because of a fear of being declined,’ commented Stephen Noakes, commercial director, Halifax Mortgages.

‘We would like to help aspirational home buyers to realize they do have options, that they can apply for a mortgage, and that it is still possible to get onto the property ladder,’ he said.

The report revealed widespread pessimism about lenders and the mortgage application process with 84% of first time buyers put off by a belief that banks do not want to lend to them and find excuses to turn them down.

Some 92% see it as hard for first-time buyers to get a mortgage, with 60% seeing it as very hard or virtually impossible. Two thirds, 67%, believe there is a general perception that everyone is rejected by lenders so there is little point in applying while 61% say they don’t want to go through the stress and anxiety of applying for a mortgage.
A helping hand

As a direct response to the research findings, Halifax is launching its First Time Buyer Pledge, a set of commitments which aims to dispel the myths surrounding loans to first time buyers.

The First-Time Buyer Pledge will launch in July and will set out exactly what customers should expect from Halifax with details of its lending criteria available online and in branches. This should enable potential borrowers to see if they fit the lending criteria before they apply.

‘Our research indicates that first-time buyers are fearful of the application process, so we want them to know that, if they come to us, we can provide them with a personalised promise on how much we can lend them, without leaving a lasting record on their credit profile,’ said Noakes. This is important as unsuccessful mortgage applications can make it more difficult to qualify on subsequent applications if the details show up on your credit file.

‘In addition, if an application is turned down, we will provide customers with information as to why and, whether they are successful or not, we will provide them with a plan to move forward,’ he said. This too could be very useful, indicating how potential applicants can clean up their credit track record.

With mortgage lenders still very risk averse there are no easy answers for first time buyers.

The size of the deposit was rated as the biggest single barrier to home ownership, and focus group comments suggest this prevents people from saving at all. Halifax is convening a panel of industry experts in the summer to explore ways to encourage young people into the home owning market with new initiatives and products

Approved borrowers pay just one dollar in closing costs, potentially savings themselves thousands of dollars. All fees associated with a mortgage closing have been eliminated, such as those for origination, underwriting, title insurance and appraisal. There are no points or hidden fees, either.

New Penn’s President and CEO, Jerry Schiano, said, “This promotion couldn’t come at a better time for many consumers who can now avoid upfront costs and still have a monthly payment that they can afford. Response to the program, which we just launched, has been strong. And response is coming from refinance customers, too, many of whom are paying down mortgages above 5 percent. We can definitely save them money.”

New Penn was founded in 2008 on the idea of combining low mortgage rates with exceptional customer service. The one-dollar closing deal is in keeping with the company’s brand promise.

About New Penn Financial: New Penn Financial, LLC is a leading nationwide lender that serves diverse consumers with a customer-focused, responsive and reliable lending approach. Providing borrowers with expertise and personal attention, the company offers some of the lowest mortgage rates available on a full suite of products and programs, which include fixed-rate loans, adjustable rate mortgage loans (ARMs), jumbo loans, FHA mortgages and more. Founded in 2008, New Penn is headquartered in Plymouth Meeting, Pennsylvania and operates regional offices across the country. The company is licensed to operate in 43 states. More information is available at http://www.newpennfinancial.com and on social media sites: http://www.twitter.com/newpennllc and http://www.facebook.com/newpennfinancial.

Important disclosures: *For first mortgage 15-year term fixed rate only. FICO > 700 and Loan Amount > $150k. Standard loan-to-values apply. Taxes and insurance escrow and daily interest are not included. Interest rate may be higher than that of other loan programs. Appraisal fee refunded at closing. Rates subject to change daily. Offer not available for NY borrowers. Example: on $200k loan, 180 monthly payments of $1,504.56. Payments don't include amounts for taxes and insurance. Actual payment obligation will be greater. Equal Housing Lender. Corporate NMLS #3013.

CA - Licensed by the Department of Corporations under the California Residential Mortgage Lending Act. CO - To check the license status of your mortgage loan originator, visit http://www.dora.state.co.us/real-estate/index.htm. GA - Georgia Residential Mortgage Licensee. MS- Licensed by the Mississippi Department of Banking and Consumer Finance. NH- Licensed by the New Hampshire Banking Department. NJ- Licensed by the N.J. Department of Banking and Insurance. NY- Licensed Mortgage Banker -- NYS Banking Department. OR- Oregon license number: ML-4667. PA- Licensed by the PA Department of Banking. VA- Virginia State Corporation Commission (license number: MC -5119).

As previously reported by FP Street, Canada’s sixth largest bank is looking to broaden its access to the mortgage business by working more closely with real estate agents. According to Canadian Mortgage Trends, an industry newsletter, National is currently one of the few banks that compensates real estate agents with cash commissions for directing customers their way. (Other lenders such as Royal Bank of Canada and Toronto-Dominion Bank offer various points rewards systems.)

“There’s a lot of signs of mortgage competition out there,” said Darko Mihilic, an analyst at Cormark Securities. Not only are lenders incenting brokers and agents, they’re also “adjusting” some of their conventional mortgage products to make them more appealing to home buyers, for instance by extending the amortization period to as much as 40 years when the buyer can make a significant down payment.

Meanwhile, most of the big banks have announced a round of mortgage rate cuts over the past few days.

Such tactics seem to be paying off and some lenders are growing faster than others — TD grew its mortgage business by 8% in the most recent quarter, for example — than the overall market as they grab business from competitors.

The average rate on the 15-year fixed loan dropped to 3.95 percent, down from 4 percent last week and the lowest on record.

Rates have fallen since spring as investors seek the safety of U.S. Treasury bonds. That has lowered the yield on Treasurys. Mortgage rates tend to track those yields.

The last time home loan rates were lower was during the 1950s, when most mortgages lasted just 20 or 25 years.

Low rates have sparked some activity in the weak housing market, but not a massive boom in refinancing.

Applications to refinance loans increased 1.3 percent and those to purchase homes increased 1.5 percent, according to the Mortgage Bankers Association.

Nevertheless, high unemployment, slow job growth and tight credit have made it difficult for many to purchase homes. The housing industry received a boost this spring when the government offered homebuying tax credits, but housing activity has plummeted since they expired in April.

The number of buyers who signed contracts to purchase homes plunged in June to the lowest level on records dating back to 2001, according to the National Association of Realtors.

To calculate the national average, Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.

Rates on five-year adjustable-rate mortgages averaged 3.63 percent, down from 3.76 percent a week earlier. Rates on one-year adjustable-rate mortgages fell to an average of 3.55 percent from 3.64 percent.

The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount. The nationwide fee for loans in Freddie Mac's survey averaged 0.7 a point for all loans.

Rates have fallen further as investors, wary of European turmoil, shifted money into the safety of U.S. Treasury bonds. Mortgage rates tend to track the interest rates paid on long-term Treasury bonds.

The average rate on a 15-year fixed-rate mortgage hit a record low of 4.20 percent, down from 4.21 percent last week. The 15-year fixed-rate mortgage is a popular choice for refinancing.

Rates on five-year, adjustable-rate mortgages averaged 3.94 percent, down from 3.97 percent a week earlier. Rates on one-year, adjustable-rate mortgages were unchanged at 3.95 percent.

The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.

The nationwide fee for loans in Freddie Mac's survey averaged 0.8 of a point for 30-year fixed-rate loans and 0.7 of a point for 5-year, 5-year loans and 1-year loans.

Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country.