About the Federal Housing Finance Regulatory Reform Act of 2008 just passed by the Senate:
Buried in the proposed legislation is something new and revolutionary, an effort to stop mortgage walk-aways.
According to author Peter G. Miller:
The Senate legislation addresses the walk away issue by saying that before borrowers can get FHA financing they must certify that they have not intentionally defaulted on any debt, not just their current mortgage. Lying about this issue can be considered perjury, and perjury can result in a jail sentence.
No less important, if a homeowner has walked away from an FHA loan, then the borrower would have to repay the government for any loss on the property — potentially tens of thousands of dollars. In the same way that we should hold lenders to certain standards, borrowers also have an obligation to meet certain requirements. Sending back the keys — creating so-called "jingle mail" — is not fair and it’s not right. The Senate committee has the correct idea: Walking away from a mortgage should not be a free pass to new financing, especially financing insured by the federal government.
I wonder how effective this legislation will be?
I think we’re going to see a lot more enlightenment. I’m still curious about the idea of working with your mortgage company as if they’re your best new friend. The smell of fish is getting stronger by the day.
Phewwee! Freemonster is right, the smell of fish is getting riper by the day…and people working with their mortgage company, that’s just another kettle of fish waiting to spill. Mortgage companies don’t really want to work with people, they’re stuck in that mentality that they can foreclose on you and sell your house to recoup their losses. Wake up mortgage companies, work with your people, something is better than nothing!
My clients (the ones in trouble anyway) are telling me that the lenders are still saying the same thing as 8 months ago…..”Call us after you missed 2 payments and we may be able to work with you.” By then you are screwed.
Perjury can result in a jail sentence? Really? Somebody better go find Bill Clinton and throw him in jail then…..
“Perjury can result in a jail sentence? Really? Somebody better go find Bill Clinton and throw him in jail then…..”
Or Scooter Libby, who was convicted in a court of law.
dogtown,
he misspoke (much like bill). I believe he meant “perjury can result in a jail sentence for us common folk.” It certainly doesn’t apply to celebs, much less Slick Willy.