The city of Nashville in Tennessee has received about $3.1 million stimulus funds in part to help individuals and families who need a place to live in after a foreclosed house sale. The program will provide short-term assistance to these new homeless to help them immediately recover from the misfortunes and get back on their feet.

The $20.3 stimulus program in Tennessee provides short-term assistance to people who are on the brink of homelessness and who are newly homeless get back on their feet immediately. One way is to put a roof over their heads.

Nashville’s share of the stimulus funds would be able to help as many as 200 individuals and 300 families. Statewide, about 5,200 people in 2,500 households will receive rental assistance, according to Tennessee Housing Development Agency program administrator Steve Meinbresse.

The program caters to people who would not qualify for the government housing programs, such as subsidized housing and tax credits, but are experiencing the crisis and need financial assistance for finding and paying a place to stay.

However, for those who want to avoid foreclosed house sale, the program excludes mortgage payments. However, it will pay for the utility deposits, rent, motel vouchers, utility payments and moving costs for not more than a year.

To become eligible for the program, individuals and families should prove that they will be able to get back on their feet in the near future and be able to pay their own utilities and rent once the federal funds run out.

Aside from losing their properties to foreclosures, eligible families also include common reasons, including lost of unemployment benefits, health reasons and job loss.

According to Meinbresse explained that the program is designed to help people who are in desperate need for existing housing and for those who have become homeless because of the sluggish economy.

Meanwhile, the program will also help homeowners with financial management, benefit applications and job coaching. Industry experts said that there is a tendency that thousands of people are going to take advantage of the short-term assistance program.

In Nashville, nine agencies have been chosen to help people who lost their properties on foreclosed house sale. These are Safe Haven, YWCA and Salvation Army.

A major housing policy change has been initiated by the Obama Administration. The change starts by abandoning the ownership society envisioned by former President George W. Bush. Instead, the federal government will use about $4.25 billion funds under the economic stimulus program to create federally subsidized rental houses in various cities.

The concept involves building low-rise rental town houses and apartment buildings and purchasing foreclosure houses to be renovated and rented at affordable rates to low and moderate income families.

According to industry analysts, the new housing policy of the Obama Administration takes a different approach from the Bush Administration’s policy of encouraging homeownership for national wealth creation and providing mobility for families in the low and working class.

They pointed out that the way Housing and Urban Development (HUD) Secretary Shaun Donovan change the federal housing policy indicated that the Obama Administration has acknowledged that homeownership is not for everyone.

Analysts also said that the change in the housing policy is also a practical response to the soaring foreclosure rate, worsening economic crisis and tight credit.

Housing Financial Services Committee Chairman Barney Frank said that the American dream should not be homeownership but a home.

The $4.25 billion allotted for the rental housing program will be taken from the funds that HUD received under the economic stimulus package. Additionally, $4 billion had been set aside to repair the 1.2 million existing public housing units in the country. The funds for the rental program will be made available to states as competitive grants.

Aside from the economic stimulus funds, the Obama Administration is also seeking $1.8 billion for rental housing construction.

Some analysts said that it is still too early to tell if the Obama Administration’s decision to shift from homeownership to rentals will benefit the working class and minorities. They still believe that homeownership provides more benefits than just creating a home equity.

But they also conceded that renting is better than placing people in houses that they could not afford to pay.

In the past weeks, Donovan went on a series of trips across the country to promote awareness of the use of the federal economic stimulus funds to construct rental houses for low and moderate families.

The HUD is hoping that the thousands of town houses and apartments that the program will be able to produce nationwide would help ease the problem of homelessness that the foreclosure crisis has created.

Foreclosed housing inventories will reach their highest levels in the third and fourth quarter next year, according to Michelle Meyer, a top economist at New York-based Barclays Capital.

Meyer predicted that sales of foreclosed houses and other pre-owned homes will increase next year to 5.41 million, compared to the 4.75 million foreclosed housing units expected to be sold this year.

She also predicted that sales of newly-constructed homes will jump to 440,000 in 2010, compared to the 350,000 units expected to be sold this year.

The economist based her forecasts on various data related to the recession, unemployment rates, consumer confidence and other financial data.

Meyer’s new-home sales forecast of 440,000 for 2009 would make this year the lowest in sales of newly-built homes since 1963, based on Census Bureau data.

In the meantime, economist Lawrence Yun predicted that foreclosed housing units this year will reach 2.5 million units.

In May, sales of pre-owned homes and foreclosed housing units increased by 2.4 percent to 4.77 million on an annualized basis, which was lower than the predicted figure. The median home price declined by nearly 17 percent compared to May 2008.

Meyer also predicted that home prices will drop by 40 percent in the third and fourth quarter next year. She explained that despite federal and state foreclosure prevention programs launched this year, foreclosure inventories will continue to grow and house prices will continue their downward slide, although at a slower rate than the pace in previous months.

Home prices may fall by another 7 percent, Meyer added, based on the home price decline index released by Standard & Poor’s Corp. this week. The S&P/Case-Shiller 20-City Home Price Index showed a drop of more than 18 percent in April on a year-over-year basis. S&P has been tracking the prices of single-family houses in 20 of the nation’s large metro areas since 1987.

The Standard & Poor report said that the three-year foreclosed housing problem has clipped nationwide home prices by about 33 percent since July 2006 when house prices were at their highest levels.

In many markets, foreclosed housing inventories are not being significantly reduced because prospective home buyers are being hindered by the rising mortgage rates, poor credit and lack of financing.

According to a group of real estate analysts and brokers, it would take nearly ten months to sell all unsold foreclosed housing units and other unsold homes based on the current pace of home sales.

The number of homebuyers applying for mortgage loans rose in February as fixed rates fell below 5 percent, according to the Mortgage Bankers Association. Among these mortgage applicants could be current mortgage borrowers who want to refinance their loans to avoid foreclosure. The MBA reported its mortgage application index increased by more than 45 percent to 875.3 during the week ended February 13.

The 875.3 index, the highest point since January 16, was reached when the average fixed-mortgage rates fell to 4.99 percent. MBA attributes the increase in the index to a significant increase in borrowers refinancing their mortgage loans.

Among these borrowers could be homeowners who have been able to pay their monthly amortizations, but who have faced difficulties in coming up with payments recently due to the downturn. Applying for loan refinancing will put them safely away from foreclosure. The index for this kind of loan has increased by more than 64 percent to 4,472.9.

In a similar direction, the gauge of loan applications for home purchases also increased by 9.1 percent to 257.3. MBA observed that mortgage rates have been following the decline in the returns of U.S. Treasury notes as the global economy continues to slow down and as the U.S. housing market continues to be flooded with foreclosed homes.

Although yields of U.S. government securities are also declining, investors have been buying them because of their relative safety. Stock indexes have been falling continuously since the start of the year, with just a few indications of an upward movement.

According to bankrate.com, the 30-year fixed mortgage rate dropped to 5.27 percent while the 15-year fixed rate fell to 4.93 percent. The adjustable-rate-mortgage rate also decreased to 5.59 percent.

The stability of mortgage rates in their attractive levels was also maintained because of efforts by the Federal Reserve to keep consumer rates lower. The Fed has been purchasing mortgage-backed securities in an effort to keep rates low and to help the country deal with the foreclosure crisis.

The record low 4.89 percent mortgage rate in early January put the MBA mortgage application index to the 1324.8 point, the highest level since July 2003. The 30-year mortgage rate however increased to 5.28 in January because of concerns about the rising Treasury debt.

The effort to keep mortgage rates low will be further boosted by Obama’s foreclosure plan, which includes expanding the $500-billion mortgage-backed securities purchase program launched in November 2008 under the Bush administration.

Read about the $75 Billion Foreclosure Bailout signed by President Barack Obama.

With the government taking over Fannie Mae and Freddie Mac, the rate for 30-year fixed mortgages dropped to 5.79 percent from 6.26 percent. Such low rate may spurn borrowers to buy real estate properties. Unfortunately, they will need to make a 20 percent down payment aside from a 740 or more credit score.

Before, a borrower with a 640 credit score can already enjoy the lowest mortgage rates available in the market. Such high qualifications come in the wake of the foreclosure crisis, where many mortgage lenders and servicers practiced aggressive lending practices. These practices were considered to be one of the reasons why millions of homeowners today are having trouble with their mortgage payments.

Learning from their mistakes, lenders have decided to tighten their underwriting guidelines and raise the credit score qualification in order to weed out the bad borrower from the good ones.

The government’s takeover of Fannie Mae and Freddie Mac has made it possible for many lenders to continue providing home loans. But because of what happened in the subprime industry, the lenders are now being extra careful. This means, that although credit is available, it can only be availed by qualified borrowers.

In the United States, the credit score is considered to be the basis of establishing a borrower’s credibility. Having a high credit score means that you are low risk and most banks will offer you low interest rates. On the other hand, a low credit score will make you unattractive to these banks and in order to manage the risks involved in lending you money, you will have to accept the high interest rate.

For consumers looking to enjoy good mortgage rates, you should make sure that your credit score is enough to meet such qualifications. If not, you will have to accept the relatively higher mortgage rates.

For more information and listings about Foreclosure Homes for Sale visit Foreclosure-Support.com.

With market conditions clearly favoring buyers over sellers, it is not surprising that you would like to take a share of the pie and purchase a foreclosure property for its good return potential. However, it is important for you to get pre-approved for a mortgage loan first before you start shopping for one of these distressed properties.

There are several reasons why you should do this:

• Guarantee Financial Source – getting pre-approved for a housing loan will basically ensure how you will pay for the purchase of the foreclosed property. It is considered to be a practical step since you would not want to waste your time searching for a property that you can not buy in the end.
• Establish Credibility to Buyer – since the buying process will involve negotiations with the lender, you will be surprised at how easier it would be if you have mortgage pre-approval. This is because the sellers will believe that you are really in the market to buy a foreclosed home and is not only wasting their time.
• Determine Working Budget – if you get pre-approved first, you will be able to find out how much money you will be working with. Based on your credit history, prevailing interest rates and present financial status, the lender will be able to give you a rough estimate of the loan amount that you could get. Keep in mind that this is not really the approved loan amount but at least you will have something to work with.
• Close Deals Faster – with a pre-approved mortgage, you will be able to enjoy some advantage over the other buyers who did not bother to get pre-approved. This is certainly a good thing especially if there are other bidders.

As soon as you have obtained mortgage pre-approval, you will be surprised at how simple it is to come up with a shortlist of foreclosure homes that you will choose from and how easy it is to negotiate prices with the seller.

Buyers of real estate properties, even foreclosure homes, should be cautious about mortgage fraud. Falling victim to one can prove to be a painful experience, both financially and emotionally. As the saying goes, prevention is always better than the cure. Even if you are dealing with a supposedly-reputable mortgage provider, you should still be able to protect yourself from fraud.

Before signing any mortgage agreements, you should first do the following:

1. Read Everything – it is very crucial for you to read and understand every little detail that is written in your mortgage contract. Although this may seem such an obvious must-do, you will be surprised to know how many home buyers have actually made the mistake of not doing this. You should never feel pressured into signing one especially if you are confused about a particular detail.
2. Look Out for Falsified Information – some mortgage brokers and providers will adjust information on your application form in order to justify the loan. Keep in mind that you are the one who will be paying for this loan and any false information will surely come back to haunt you.
3. Get Your Copy – before signing, you should make sure that you have an exact copy of the mortgage contract you are about to sign. You should remember that mortgage contracts are contracts of obligation and not having an identical copy of your own will prove to be very inconvenient for you during disputes and errors.

Mortgage fraud is actually avoidable if homebuyers just do their homework. For the last couple of years, the housing industry has suffered greatly because of the numerous incidence of mortgage frauds committed during the last housing boom, which resulted to millions of homeowners losing their homes to foreclosure. For this reason, lending guidelines have also been tightened to discourage such aggressive practices.

For the month of May, Florida posted the 4th highest foreclosure rate in the nation, with one out of 228 homes entering some stage of foreclosure. Considering this, it is not surprising that the local government is doing everything in its power to stem the rising tide o foreclosure.

In addition to holding foreclosure workshops and seminars, state legislators have decided to pass a new law that protects troubled homeowners from fraudulent scams. The new law named Foreclosure Rescue Fraud Prevention Act of 2008 will take effect on October 1.

Since there is an alarming increase in fraud-related foreclosure, the new law will be able to address this concern by requiring foreclosure rescue consultant to be present in the proceeding. The consultant will act as mediator as well and help the homeowner work out a repayment plan with their lender.

Every detail of the mediation process will be recorded and included in a written agreement, which will be signed by the homeowner. If the homeowner decides to cancel the agreement, he will be allowed to do so as indicated in the contract. But this is only possible after a 5-day cooling off period.

These foreclosure consultants are also not allowed to take any form of payment until the entire process is completed. This will ensure that the homeowner will receive the proper assistance in order to address their mortgage problems.

Coincidentally, the number of foreclosure rescue scams reported in the past two years has increased by almost 600 percent as the inventory of foreclosure homes continue to grow.

Troubled homeowners are targeted by bogus foreclosure companies. The scams usually involved offers of stopping foreclosure by transferring title, shouldering mortgage payments while homeowners become renters and sometimes, even bankruptcy assistance.

Many state officials have campaigned against these foreclosure scams especially as they are becoming more and more rampant in areas hit hardest by the foreclosure crisis.

In a recent poll commissioned by the American Bar Association, it was discovered that about 50 percent of Americans who currently have a mortgage are having concerns about staying in their homes and avoiding foreclosure.

In addition, the survey also revealed that 73 percent of the participants have adjusted their spending habits in order to accommodate the increases in food and fuel prices. With regards to taking action to address these concerns, 61 percent of the respondents have already done something while the rest of the 39 percent have not made any step towards a solution.

For the ABA, this worrying could lead to wrong decisions. Instead of getting concerned about facing foreclosure and getting rid of consumer debts, it is recommended that you focus on knowing your rights as a consumer and borrower. This way, you will be able to address your problems properly and be able to make informed decisions.

If you are worried about your piling credit card concerns, you can always look for information regarding credit management. The internet is actually a good source and you will be able to access information much more easily.

On the other hand, if your concern is not being able to pay your monthly mortgage dues, then you will certainly have to look at your finances. Look for ways to cut back on spending and determine whether you have understood the loan terms and conditions.

During the last housing boom, many home buyers got approved for loans that they could never afford. To make matters worse, the hybrid loans being offered at that time were really not advantageous to borrowers in the long term. As a result, millions of homes have entered some stage of foreclosure in the last couple of years.

If possible, speak with your lender about the possibility of refinancing or loan modification if you have discovered that might no longer be able to afford your mortgage.

The important thing is taking action. Once you have taken the necessary steps to address your concerns, you will be able to stop worrying about them.

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According to retirement plan administrators nationwide, homeowners are cashing out their 401(k) accounts citing hardship as the reason for the withdrawals. The number one hardship being revealed by this group of individuals is to stop foreclosures. Traditionally, people could take loans from their 401(k). However, loans just won’t keep their homes from appearing on foreclosure listings. Foreclosure homes are devastating to the economy and to the public, as everyone suffers.

The United States Post Office is delivering Notices of Default in record numbers. These Notices of Default indicate bank foreclosures and Government foreclosures are imminent if payment or payment arrangements are not forthcoming immediately. Additional mailing offerings reveal publications of foreclosure homes for sale as well as repo homes and homes on the market due to an unpaid tax lien. Mail delivery is only one avenue that this information is getting to the public eye. Its becoming increasingly more difficult to not hear or see or know about the foreclosure market. It is virtually everywhere.

What can you do in this foreclosure market? Buy these foreclosures instead of other homes for sale. Why? Foreclosures will save you tons of money and appreciate faster when the market does its reverse and real estate is once again king. Foreclosures are priced considerably below market value, often times by 25% – 50%. Sound good? It should, purchasing a foreclosure will strengthen your personal financial portfolio. Want to start today? Become a member, all the vital info is found inside, you will learn foreclosure secrets and info that will make this investment journey easy and profitable. Click here to join.

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