The latest incarnation of a housing relief bill comes from the Senate — and it has been cautiously praised by the White House. The Senate housing relief bill (dubbed the Federal Housing Finance Regulatory Reform Act of 2008) is a bi-partisan exercise in compromise from the committee dealing with urban affairs, housing and banking. FHA Mortgage Guide reports on the highlights of the housing relief bill:

The measure will allow the FHA to insure as much as $300 billion in new mortgages to replace existing toxic loans — but only for homeowners, not investors, and only if lenders will accept write-downs.

One of the main complaints coming out of the White House was the House version of the housing relief bill did too much to help mortgage lenders and speculative investors at taxpayer cost. The new version places greater emphasis on helping homeowners and forestalling foreclosures. The New York Times reports on the White House response to the new bill:

Tony Fratto, a spokesman for the White House, said the administration still needed to review the specific language in the bill. But, he said: “We appreciate and encourage the efforts to create a strong, independent regulator” for the government-sponsored mortgage finance companies. “We’ll look forward to seeing the details of the bill,” he added, “especially provisions to expand programs of the Federal Housing Administration.”

Now, though, with a House version already passed, there needs to be agreement on the two bill. This will be worked out in a special conference committee. There are hopes that Republicans will be willing to deal. They proved that certain realities were willing to get them to the table in the Senate — where Republican cooperation is more important than it is in the House.

Do you think that there should be help for troubled homeowners to avoid foreclosures?

Tags: Senate housing bill, housing relief bill, home mortgage loan, mortgage loan blog,
mortgage lenders, White House, foreclosures

Apparently, there are still some folks out there offering seminars on how to get rich by flipping homes. Here is a reader question:

I am thinking of investing in real estate. A buddy of mine is telling me that I should get into house flipping, and he can help me get started if I attend a seminar. Is this a good way to get into real estate?

While it is true that now can be a good time to buy a home, it is not the best time to buy for flipping purposes. Home values are still struggling, and if you buy a home now to turnaround and sell again, you are not likely to make any money.

Right now, when you buy a home and get into a home mortgage loan, it is more of a long term deal. The home will likely increase in value, but it will probably take seven to ten years to get any real appreciation out of it.

Buy a home for investment purposes

If you have the credit and the down payment for it, you could get into real estate investing by buying an investment property. This is something that will offer you a regular monthly return (this isn’t house flipping). If you can buy a home that you can rent out to cover the home mortgage loan payments, that might be a good idea. There are some good deals on foreclosures right now, and that could be one way to create another income stream.

But beware of house flipping. With the real estate market as it is now, you are not likely to make a quick profit. Now is the time to think of investing in real estate as a long term investment.

Tags: house flipping, real estate, home mortgage loan, mortgage loan blog,
investing real estate, buy a home, real estate market

Apparently, there are still some folks out there offering seminars on how to get rich by flipping homes. Here is a reader question:

I am thinking of investing in real estate. A buddy of mine is telling me that I should get into house flipping, and he can help me get started if I attend a seminar. Is this a good way to get into real estate?

While it is true that now can be a good time to buy a home, it is not the best time to buy for flipping purposes. Home values are still struggling, and if you buy a home now to turnaround and sell again, you are not likely to make any money.

Right now, when you buy a home and get into a home mortgage loan, it is more of a long term deal. The home will likely increase in value, but it will probably take seven to ten years to get any real appreciation out of it.

Buy a home for investment purposes

If you have the credit and the down payment for it, you could get into real estate investing by buying an investment property. This is something that will offer you a regular monthly return (this isn’t house flipping). If you can buy a home that you can rent out to cover the home mortgage loan payments, that might be a good idea. There are some good deals on foreclosures right now, and that could be one way to create another income stream.

But beware of house flipping. With the real estate market as it is now, you are not likely to make a quick profit. Now is the time to think of investing in real estate as a long term investment.

Tags: house flipping, real estate, home mortgage loan, mortgage loan blog,
investing real estate, buy a home, real estate market