Harvey Realty, Inc.

Fannie Mae last week announced it would extend the suspension of foreclosure sales and evictions from single-family properties through Jan. 31, 2009, enabling the company to work with mortgage servicers to further implement the Streamlined Modification Program (SMP) announced on Nov. 11 and initiated on Dec. 15. The extension also will provide additional time for the company to operationalize its new National REO Rental Policy.

The temporary suspension of foreclosures will allow affected borrowers facing foreclosure to retain their homes while Fannie Mae works with mortgage servicers to implement the SMP. Foreclosure attorneys and loan servicers have been instructed to use the additional time to reach out to borrowers and continue to pursue workout options. The initiative applies to loans owned or securitized by Fannie Mae.

The SMP is aimed at the borrower who has missed three payments or more, owns and occupies the primary residence, and has not filed for bankruptcy. The program creates a fast-track method for getting troubled borrowers into an affordable monthly payment through a mix of reducing the mortgage interest rate, extending the life of the loan, or even deferring payments on part of the principal. Servicers have flexibility in the approach, but the objective is to create a more affordable payment for borrowers at risk of foreclosure.

Printed with permission from the California Assiciation of Realtors.

The Conference Board Employment Trends Index (ETI)™ declined 1.6 percent in December and now stands at 99.6, down almost 16 percent from a year ago, according to a recent report by The Conference Board.

The 17-month-long decline in the Employment Trends Index (ETI)™ was seen in all eight of its components, most notably over the past six months in temporary-help hires and part-time workers for economic reasons, said Gad Levanon, senior economist at The Conference Board. "The continued deterioration in the Employment Trends Index signals that no turnaround in the labor market is to be expected in the near future," he said.

Printed with permission from the California Assiciation of Realtors.

A new National Real Estate Owned (REO) Rental Policy will allow qualified renters in Fannie Mae-owned foreclosed properties to stay in their homes, Fannie Mae announced yesterday. The new policy applies to renters occupying foreclosed properties at the time Fannie Mae acquires the property. Renters occupying any type of single-family property will be eligible, including residents of two- to four-unit properties, condos, co-ops, single-family detached homes, and manufactured housing. Eligible renters will be offered a new month-to-month lease with Fannie Mae or financial assistance for their transition to new housing should they choose to vacate the property. The properties must meet state laws and local code requirements for a rental property.

While the company markets the properties for sale, Fannie Mae will manage the properties through a real estate broker or a property management company. The company will not require security deposits to be posted in connection with this program.

Renters in the foreclosed properties will be asked to pay market rate rent under the new leases. Rates may be determined by reviewing local comparable rents, conducting a neighborhood survey, or through other relevant indicators. Rates also will be subject to any legal rent control restrictions. The company will review each instance where the market rate may require a tenant to pay additional rent and will work to reach an equitable resolution.

Printed by permission from the California Association of Realtors.

The Market Composite Index, a measure of mortgage loan application volume, increased 15.8 percent on a seasonally adjusted basis for the week ending Jan. 9 compared with 1143.8 one week earlier, when it stood at 1324.8, according to a report released today by the Mortgage Bankers Association (MBA). On an unadjusted basis, the Index increased 95.7 percent for the week ending Jan. 9 compared with the previous week and was up 52.4 percent compared with the same week one year earlier.

The Refinance Index increased 25.6 percent to 7414.1 for the week ending Jan. 9 from 5904.5 the previous week, while the seasonally adjusted Purchase Index decreased 14.1 percent to 295.8 for the week ending Jan. 9 compared with 344.2 one week earlier. The Refinance Index is at its highest level since June 2003.

The refinance share of mortgage activity increased to 85.3 percent of total applications for the week ending Jan. 9 compared with 79.8 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 1.1 percent for the week ending Jan. 9 from 0.9 percent of total applications from the previous week, according to the report.

Printed by permission of the California Association of Realtors.