Mortgages Underwater

A recent report shows that over 10 million homeowners owe more on their home then they are worth. Many are taking it as a sign of more foreclosures to come. As values continue to plummet more and more homeowners will end up in this situation. California, Nevada, Arizona, Florida, and Michigan are among the states that has the highest rate of underwater mortgages.

According to CNN, "these five states have been especially beleaguered because of a high rate of prime loans that went bad. Many of those loans were option-adjustable rate mortgages, in which borrowers could choose to make minimum payments that were so low they did not even offset the interest being accumulated."

No More Closing Costs

Some good news for home buyers and those who want to refinance, HUD is working on eliminating those surprise closing costs that often come-up last minute. HUD is hoping that by January 1st this situation that so many people find themselves in, will be a thing of the past. Bank and mortgage lobbies are pushing for a delay on this change. The changes that are to be set in place include:

* Fees that cannot increase from upfront estimates to final closing.

* Fee estimates that come with wiggle room, and can increase by as much as 10% in the aggregate from upfront estimates.

* Fees that can increase without limit, mainly because the lender has no control over them or because the amount is difficult to predict weeks in advance.