Choosing the right light bulb

n the world of home improvement products, it used to be that one of the things you could count on for consistency year after year was the light bulb. Little changed since its invention, so it was a product that you didn't really have to give much thought to.

No longer. Today, there's a lot of confusion surrounding this simple staple of the American household. Are 100-watt bulbs banned? Are those twisty bulbs dangerous? Can you use these new bulbs with a dimmer? Aren't the new bulbs really expensive? There are lots of questions and lots of confusing answers, so let's try to clear up what we can.

Incandescent bulbs

Incandescent bulbs are the traditional household light bulb. They consume electricity, which is measured in watts, and give off light, which is measured in lumens. However, most of the electricity they consume is actually given off as heat, so these bulbs have never been particularly energy efficient.

ncandescent bulbs haven't technically been "banned." What's happened is that new energy efficiency standards have been put into place, which simply means that the bulbs now need to consume less electricity for same amount of lumens produced.

So the traditional 100-watt light bulb is, in essence, a thing of the past. It's being replaced by a bulb that produces the same amount of light, but uses about 72 watts. Since that translates to money in your pocket in the form of energy savings, it's not a bad thing. Similar wattage-to-lumen reductions are set to phase in for other bulbs over time, but given the ongoing mess in Washington, those dates are a congressional moving target.

Halogen bulbs

Halogen bulbs, also called energy-saving bulbs, are incandescent light bulbs that have a capsule inside that holds halogen gas around the filament, which increases the efficiency of the bulb. Halogen bulbs are a little more expensive to buy initially, but their energy efficiency increases by about 25 percent over a standard incandescent bulb, and they can last up to three times as long.

Another advantage to halogen bulbs is their color rendition, which is the ability of a light source to render the colors of an object similar to the way sunlight does. This makes them a great choice for many desk and task light applications. Halogen bulbs can also be used with dimmers.

Compact fluorescent bulbs

Compact fluorescent bulbs, or CFLs, are the increasingly familiar "curly tube" light bulb. Once again, they're more expensive to purchase initially than a standard incandescent bulb, but their increasing popularity and availability is bringing prices down.

CFL bulbs uses about a quarter of the energy that a standard bulb uses to produce the same number of lumens, so that's a pretty good savings. They're estimated to last about 10 times as long, so that offsets the somewhat higher initial cost; in fact, the Department of Energy estimates that a typical CFL will pay for itself in less than nine months.

As CFLs have become more popular, they've become available in a range of colors that weren't available when they were first introduced. You can now get CFLs with warm, yellow tones, as well as bulbs that are encased in an outer cover that help diffuse the light better -- and which, coincidentally, also makes them look much more like a traditional light bulb. Some CFLs can also be used with a dimmer switch, but be sure that you verify that on the package when you buy it.

CFLs do contain a small amount of mercury, as do all fluorescent bulbs. When they burn out, they shouldn't be disposed of with the regular trash. Instead, they need to be properly recycled, which is something that a growing number of retailers are doing at no charge.

LED bulbs

The final type of bulb you want to be aware of is the light-emitting diode, or LED. These bulbs are semiconductors that convert electricity into light. They're actually in the early stages of development at this point, so they're still pretty expensive. However, many people think that these bulbs have a tremendous amount of potential, and represent the wave of the future in residential and commercial lighting. As such, their prices should begin coming down.

LED bulbs use only about 25 percent of the energy that a conventional bulb does, but their real advantage is in their life span. An LED bulb is estimated to last about 25 times longer than a conventional bulb, so even with the high initial cost, their use may still make good economic sense for applications where bulbs are difficult to access for replacement.

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general. 

Please click on this link to view the Housing Trends NOVEMBER - 2012 Newsletter http://wendyjimenez.housingtrendsenewsletter.com 

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau, Realtor.org reports and other sources. 

Housing Trends eNewsletter is filled with local and national real estate sales and price activity provided by MLSs and the National Association of Realtors, U.S. Census Bureau key market indicators, consumer videos, blogs, real estate glossary, mortgage rates and calculators, consumer articles, and REALTOR.com local community reports. 

If you are interested in determining the value of your home, click the “Home Evaluator” link for a free evaluation report: 

http://wendyjimenez.housingtrendsenewsletter.com/dispContent.cfm?loadid=2&loadtype=0 

Sound decisions can only be made with accurate and reliable information, and I am happy to be a trusted resource for you. Thank you for the opportunity to provide you with this monthly eNewsletter, and I look forward to answering any questions you may have and to the opportunity to be your REALTOR® in the future. 

Sincerely yours, 

Wendy Jimenez
Century 21 Jervis and Associates
800 N. Harbor Blvd La Habra CA 90631 562-243-2966wendy@wendyj4homes.com 

Take Precautions when making donations

Tip of the Week: Take precautions when making donations this holiday season
Before making a donation of any kind, consumers should adhere to certain guidelines, including the following:

• Do not respond to any unsolicited (spam) incoming emails, including by clicking links contained within those messages, because they may contain computer viruses.
• Be cautious of individuals representing themselves as victims or officials asking for donations via email or social networking sites.
• Beware of organizations with copycat names similar to, but not exactly the same as, those of reputable charities.
• Rather than following a purported link to a website, verify the existence and legitimacy of non-profit organizations by searching for the organization online.
• To ensure that contributions are received and used for intended purposes, make donations directly to known organizations rather than relying on others to make the donation on your behalf.

5 things you can do to prevent spyware and viruses on your computer

For more information, go to www.fixingmypc.com or call today!

California's Most Affordable Counties

Thanksgiving Decorating Ideas to Impress your Guests

Thanksgiving decorating ideas to surly impress your guests.

Thanksgiving is a time to share with family and friends and if that sharing is going on at your house, feeling the need to impress can be overwhelming. Below are some table decorating ideas that will be sure to impress your guests. They will also make for a festive mood!

Sumptuous Centerpiece

Make the centerpiece as colorful as the rest of the table. Keep it compact so it doesn't interfere with the passing of dishes.

 

 

 

 

 

 

 

 

 

 

 

Harvest Color

Jewel tones and saturated color heighten the appearance of the Thanksgiving table and celebrate the season's bright foliage against the late-autumn sky. To get the look here, take advantage of the enhanced color attributes of inexpensive faux foliage and rich textile remnants. Present the faux berries and leaves (combined with real leaves, if you like) in a free-form display of pitchers and teapots, sugar bowls and goblets. The burnished finish of the collection will unify the look of the table, and the display lets you enjoy objects you love but don't always have the opportunity to use. Soften the effect with simple white candles; just be sure to set their flames well clear of the berries and leaves.

 

 

 

 

 

Fruitful Place Settings

The table, dressed in a rich palette and laden with autumn fruit, sets the tone for an intimate Thanksgiving dinner. Plump persimmons and scarlet pomegranates adorn the table — and the menu — a ripe reminder of the season's exuberant, and occasionally exotic, abundance. The table setting is a compatible mix of old (heirloom silver and dishes) and new (table runners, glasses, napkins), simply yet artfully arranged to bring out the beauty of all.

 

 

 

 

 

 

 

 

Table Tips

No-Sew Runner: Go through your sewing stash or the remnants bin at your favorite fabric store with an eye to reds and golds. Cut fabric to a length suitable for your table, turning under and pressing raw edges.

Easy Tablescape: Gather together a variety of pewter or silver pieces. Their deep metallic tones offer rich contrast to bright plates in autumn hues. Mix candlesticks with open vessels to vary height and shape.

Leaf Placecards: Real leaves curl, or dry and crack, so try this: Snip faux leaves and berries from inexpensive artificial clusters or garlands, and then use a silver gel pen to write each guest's first name on a leaf.

 

 

Homespun Crafts

In the days before Thanksgiving, a sense of anticipation fills the house as preparations begin. Spend an afternoon enjoying this feeling along with some young helpers or friends. This felt tablescape can be crafted days or weeks in advance to suit your schedule. Visit a fabric or craft supply store to buy wool felt, keeping in mind the length of your table and the number of guests. Cut a wide strip of felt in burnt orange for the bottom layer of the runner and a narrower green layer for the top. Wrap the candles and napkins with their lettered bands, and then arrange "falling leaves" along the table's length.

 

 

 

 

 

 

 

 

Buffet Centerpiece

Add a playful yet practical touch to your table by bringing an outdoor piece — like a garden plant stand — indoors and placing a cake, tart, or pie into the stand's arms.

 

 

 

 

 

 

 

 

New short-sale program offers relief for underwater homeowners

New short-sale program offers relief for underwater homeowners
One of the federal government’s most-important financial relief efforts for underwater homeowners started operating Nov. 1.

• Traditionally short sales, where the lender agrees to accept less than the full amount owed and the house is sold to a new purchaser at a discounted price, are associated with extended periods of delinquency by the original owner.  The new Fannie-Freddie program breaks with tradition by allowing short sales for owners who are current on their payments but are encountering a hardship that could force them into default.

• Eligible hardships under the new program run the gamut: Job loss or reduction in income; divorce or separation; death of a borrower or another wage earner who helps pay the mortgage; serious illness or disability; employment transfer of 50 miles or greater; natural or man-made disaster; a sudden increase in housing expenses beyond the borrower’s control; a business failure; and “other,” meaning a serious financial issue that isn’t one of the above.

• Homeowners who participate in this new program should be aware that although officials at the Federal Housing Finance Agency – the agency that oversees the program – are working on possible solutions with the credit industry at the moment, it appears that borrowers who use the new program may be hit with significant penalties on their FICO credit scores – 150 points or more.

• Other factors to consider are promissory notes and other “contributions.”  In the majority of states where lenders can pursue deficiencies, Fannie and Freddie expect borrowers who have assets to either make upfront cash contributions covering some of the loan balance owed or sign a promissory note.  This would be in exchange for an official waiver of the debt for credit reporting purposes, potentially producing a more favorable credit score for the sellers.

• Finally, participants should be aware of second-lien hurdles.  The program sets a $6,000 limit on what second lien holders – banks that have extended equity lines of credit or second mortgages on underwater properties – can collect out of the new short sales.  Some banks, however, don’t consider this a sufficient amount and may threaten to thwart sales if they cannot somehow extract more.

October Housing Statistics for 90604

Happy Veteran's Day

Wells Fargo sends refunds to some FHA mortgage customers

Thousands of Wells Fargo & Co. home loan customers recently received a surprise in the mail: refund checks from the big bank, along with letters saying they had paid unnecessary fees for their mortgages.

The unsolicited offers of thousands of dollars arrived with a catch — if the borrowers cash the checks, they can't later sue the No. 1 U.S. home lender. The San Francisco bank said in the letters that borrowers were put into more expensive loans when they could have qualified for cheaper ones.

Analysts said the letters sent to potentially 10,000 Wells Fargo borrowers were a way for the bank to sidestep further litigation over "steering" customers into unfavorable loans — allegations that the government has made about certain Wells Fargo operations in the past.

It's one in a long series of legal troubles for major mortgage lenders, the five largest of which agreed in February to a $25-billion settlement of accusations that they "robo-signed" foreclosure affidavits and otherwise abused distressed borrowers. Mortgage investors have barraged them with lawsuits over defaulted loans, and the government also recently filed separate complaints against banks including Wells Fargo, JPMorgan Chase & Co. and Bank of America Corp.

"It sounds like they either found some problems themselves or the regulators discovered them and told them to get things fixed," said Paul J. Miller, an analyst who follows Wells Fargo for Friedman, Billings, Ramsey & Co.

Wells Fargo's mailed refunds involve government-backedFHA mortgages made from 2009 through 2011. These loans are often made to borrowers with shaky credit or those who can't come up with the 20% down payments required for conventional loans.

Though they require as little as 3.5% down, the FHA loans are also more expensive because they require borrowers to pay steep insurance payments to protect against a default. However, in this case, the borrowers actually had the down payments or home equity needed to get a conventional loan, bank officials said.

Wells Fargo spokeswoman Vickee Adams said the problematic FHA loans turned up as the bank reviewed operations at two mortgage channels it has closed down: a subprime lending arm, Wells Fargo Financial, and a wholesale arm that made loans through independent brokers.

The bank previously paid a combined $260 million to settle Federal Reserve and Justice Department allegations that its lending, pay and sales quota practices in the home lending business caused borrowers to be placed into higher-cost mortgages. It didn't admit wrongdoing.

The loans were written as Wells Fargo surged to become the No. 1 originator of loans insured by the FHA. A bank mortgage spokesman said 528,000 Wells borrowers received FHA loans during the years 2009 through 2011, of which fewer than 2%, or 10,560, were offered refunds. He wouldn't say exactly how many refunds the bank has offered.

Mortgage professionals say banks often make more money packaging FHA loans into mortgage bonds than they do on traditional loans because of the government guarantee. And at the time in question, loan officers often made higher commissions on FHA loans.

The refunds came to light when the Los Angeles Times obtained a copy of one of the letters. The bank never announced them publicly.

Pomona resident Eric Murrillo-Angelo received a $6,676.89 check last month in a letter saying he "may have qualified for a conventional conforming mortgage" instead of the FHA loan he got in March 2010.

"I was really excited," he said, "although maybe a little leery at first."

Wells Fargo said a traditional loan would have had about the same interest rate as the FHA loan, but Murrillo-Angelo would not have been charged insurance premiums and higher appraisal and processing fees.

The refund included $4,847.50 for an upfront premium, $1,154.20 in annual premiums and $355 in increased closing costs, plus interest.

"You should understand that by cashing the enclosed check, you agree to release Wells Fargo … from any and all claims relating to Wells Fargo's origination of a more expensive mortgage loan than the loan for which you may have qualified," a bold-faced paragraph read.

After thinking the offer over for about a week, Murillo-Angelo cashed the check.

Loan officers were able to earn a commission of about 2.5% of the loan amount for FHA-backed mortgages in 2009, 2010 and part of 2011, said Fred Arnold, past president of the California Assn. of Mortgage Professionals. That compares with 1.75% commissions for conventional loans, he said.

For example, a $350,000 FHA mortgage would yield an $8,750 commission compared with $6,125 for a conventional loan.

"That meant that some unethical loan officers could potentially steer borrowers to the wrong loan," said Arnold, who noted that regulatory reforms that took effect in 2011 make it impossible to pay a loan officer more for originating one type of loan rather than another.

A Wells Fargo spokeswoman declined to comment directly about the firm's compensation practices. She instead provided a general statement of the bank's policies: "We work hard to offer the appropriate loan options so that every borrower receives the appropriate loan based on his or her credit characteristics and personal circumstances and our compensation reflects that commitment," the statement said.

Meanwhile, the bank — along with others on Wall Street — packaged its loans into mortgage-backed securities for sale to investors. Loans that met certain standards received a guarantee from government-supported housing agencies Fannie Mae and Freddie Mac.

FHA loans, however, received a higher premium when packaged into bonds. They receive a guarantee by the Government National Mortgage Assn., the federal agency known as Ginnie Mae. These securities are a notch safer for investors than Fannie or Freddie bonds, and that made them more appealing for big institutional investors like sovereign wealth funds or mutual funds.

Although the federal government has not pursued criminal prosecutions of bankers at the heart of the mortgage operations that collapsed in 2007, it has stepped up civil lawsuits against the largest originators and securitizers of home loans during the boom.

This month's federal suit against Wells Fargo was filed by the U.S. attorney's office in Manhattan, which has brought six mortgage-fraud lawsuits against big banks in the last 18 months. The latest, filed Wednesday, seeks more than $1 billion from Bank of America for allegedly flawed loans that itsCountrywide Financial Corp. unit sold to Fannie and Freddie.

Gen X & Y and Homeownership [INFOGRAPHIC]

6 Tax Facts Home Sellers Should Know

Should you accept offer to wipe out home loan?

What seems like a well-meaning offer from corporate America has turned into a hurdle for some borrowers in the late stages of a short sale.

Big-name lenders are notifying certain homeowners that they can get the debt of their second mortgages wiped out and those liens released, just like that.

The ideal outcome is to help borrowers who've defaulted on their home loans build equity so they no longer owe more than their homes are worth, which encourages them to continue making payments and stay in their properties.

Some of these offers have come with issues though, mainly for Bank of America clients. In some cases, the offers of full second loan forgiveness have or could have jeopardized those in the middle of a short sale, deals in which people sell their homes for less than what they owe on the mortgage as long as the lender gives the green light. In other cases, homeowners still don't have equity post-forgiveness.

These instances highlight the imperfections and unintended consequences that come with rolling out a massive program to help a lot of consumers quickly, said Katherine Porter, the California monitor of a $25 billion deal between 49 states and five banks that was signed in the spring. Lenders including Bank of America have forgiven and released second-loan amounts averaging $69,000, as part of that landmark deal that settled accusations of long-running mortgage abuse.

"There's definitely an effort to reach out to so many people, but there are definitely these friction points," said Porter, in an interview with the U-T San Diego. She has heard of similar issues from consumers throughout the state.

Brian Ruhl, a short sale Realtor in San Diego, has worked with clients who have experienced that kind of friction. In one case, Wells Fargo, the owner of the first loan, gave the OK to do a short sale, an offer good for only 30 days. More than a week later, the homeowner realized his second lien, owned by Bank of America, had been extinguished since he didn't opt out by the required date.

Even though Bank of America had fully discharged the debt of the second loan, it hadn't fully "released" the lien, which is required for a short sale to close. The estimated time for lien release was up to 90 days, which would cause his client to miss the 30-day closing deadline imposed by Wells Fargo.

Related: Why the big banks are doing more short sales

"They can't sell the property," said Ruhl, referring to the snag. "It delays the short sale process."

Ruhl had been unsuccessful in persuading Bank of America officials to release the lien sooner until the U-T began to ask questions about the transaction earlier this month.

Bank spokesman Richard Simon repeatedly told the U-T a second lien extinguishment would not affect the timeline or approval of a short sale and the goal is to release the second lien within a month to six weeks. The bank then corrected itself after looking into the file for one of Ruhl's clients.

"It appears that a limited number of short sales in the late stages of approval were interrupted and closed as the second-lien extinguishment program was rolling out and the short sale teams were uncertain how to treat the unfamiliar situation for him," Simon said.

Banks officials have promised to change the process and provide training to representatives so that these delays no longer occur, Simon said.

San Diego short sale negotiator Jacalyn Blank actually told two of her clients to say no to the second-lien forgiveness from Bank of America because she feared that their short sales would be delayed. Bank reps gave her a 90-day release estimate, which again, would have delayed the short sale from closing, Blank said.

Another issue that has cropped up: Some borrowers will see no benefit from the program because they would still be underwater after their second-lien debts are discharged.

In both of Blank's cases, neither borrower would have been in an equity position following a forgiveness.

"I think it's a publicity stunt," said Blank, referring to the program. "I think it's a way for Bank of America to improve their public image. If you don't know the circumstances surrounding the individual's second loan, then it could look like you're doing a great thing."

So far, more than 2,800 homeowners in the nation have had their second liens "extinguished," totaling $199 million, or a rough average of $69,000 a person. Those numbers are based on a government report that covers March through June, the first four months of the settlement, so those figures have likely risen since then.

Bank of America, the most aggressive of the five banks in providing full forgiveness of second liens, is in the process of notifying about 150,000 of its borrowers that they qualify for these wipe-outs. Many of these second loans were absorbed after the purchase of Countrywide, which did a lot of piggy-back loans during the housing boom, said Porter, the public official keeping tabs on the mortgage settlement for California.

The more relief banks give, the more credits they get through the mortgage settlement. The sooner they rack up the needed credits, the sooner they are off the hook in providing consumer relief. Credit amounts also vary by relief.

Porter said she's aware of these second-lien forgiveness issues and stresses that no banks have received credits yet for any consumer help they've given so far.

The five lenders in the settlement agreement -- Bank of America, Wells Fargo, Citi, Chase and Ally -- must routinely submit reports to the national mortgage monitor. At some point, they will be grilled over the relief they receive and how much credit they would be due.

"I want the banks to get credit only where credit is due," she said

Principal relief for stressed homeowners

Principal relief for stressed homeowners
A limited number of underwater homeowners in California will soon be able to get principal reductions of up to $100,000 apiece on Fannie Mae and Freddie Mac loans through the federally funded Keep Your Home California program.

Making sense of the story

• Although the federal agency that oversees Fannie and Freddie had previously refused to allow permanent principal reduction on loans they own or guarantee, in mid-September, the Federal Housing Finance Agency told servicers they could immediately begin accepting money for principal reductions from programs financed by the U.S. Treasury’s Hardest Hit Fund, including Keep Your Home California.
  
   
• The California Housing Finance Agency set up four programs under the Keep Your Home name to distribute California’s Share of the funds -- $1.9 billion.  It allocated $772 million to principal reduction – enough to help an estimated 9,000 borrowers.
  
   
• To qualify for the principal reduction in California, homeowners must live in the home, owe more than it is worth, be of low-to-moderate income, and be delinquent or have some hardship that puts them in imminent risk of default.
  
   
• The balance on the first mortgage cannot exceed $729,750.  Other rules apply, but there is no asset limitation.  The maximum reduction is $100,000 per homeowner.

Principal relief for stressed homeowners

A limited number of underwater homeowners in California will soon be able to get principal reductions of up to $100,000 apiece on Fannie Mae and Freddie Mac loans through the federally funded Keep Your Home California program.

The federal agency that oversees Fannie and Freddie has steadfastly refused to allow permanent principal reduction on loans they own or guarantee on the grounds it would cost taxpayers money. But in mid-September, Fannie and Freddie told servicers they could immediately begin accepting money for principal reductions from programs financed by the U.S. Treasury's Hardest Hit Fund, including Keep Your Home California.

Fannie's and Freddie's willingness to accept money from Hardest Hit Funds does not signal a change of heart on the part of their regulator, the Federal Housing Finance Agency. Lest anyone get the wrong idea, Freddie says it will allow funds to be used for "principal curtailment."

"We don't consider it (principal reduction) in a way that is commonly understood. We are not writing off some percentage of the amount owed. We are simply accepting funds ... through this program to allow it to be applied to unpaid principal or arrearage," Freddie Mac spokesman Brad German says.

Fannie Mae spokesman Andrew Wilson says, "This in fact for us is not a principal reduction. It's a principal payment. It's as if your grandmother wanted to give you $50,000 to apply to your mortgage. In this case, the grandmother, as it were, was the Hardest Hit Fund."

Taxpayer funded

That may be, but the money is still coming from taxpayers. The fund was set up in 2010 to provide $17 billion in homeowner assistance to 18 states hardest hit by the housing crisis.

The California Housing Finance Agency set up four programs under the Keep Your Home name to distribute California's share - $1.9 billion. It allocated $772 million to principal reduction - enough to help an estimated 9,000 borrowers.

It could shift money from the other three Keep Your Home programs to provide more principal reductions, program director Diane Richardson says. The other programs make mortgage payments on behalf of unemployed and delinquent borrowers and provide transition assistance to homeowners who are going through a foreclosure or short sale.

To qualify for principal reduction in California, homeowners must live in the home, owe more than it is worth, be of low-to-moderate income, and be delinquent or have some hardship that puts them in imminent risk of default.

The balance on the first mortgage cannot exceed $729,750. Other rules apply, but there is no asset limitation. The maximum reduction is $100,000 per homeowner.

For eligible homeowners, the program will reduce mortgage payments to less than 38 percent of household income by reducing principal to between 105 and 140 percent of the home's value.

The goal is to provide a sustainable mortgage payment, not to provide instant equity. For that reason, the principal reduction is structured as a loan that is forgiven after five years.

Five-year plan

If a homeowner gets $100,000 in principal reduction and within five years sells the home for a profit or refinances and takes cash out, the profit or cash-out - up to $100,000 - must be used to repay the loan. After five years, there is no repayment requirement.

Under the original rules, servicers had to reduce principal by $1 for every $1 in principal reduction provided by the program, but few write-downs got done.

In May, the program eliminated the matching requirement and since then more servicers have taken part. To date, 2,511 homeowners have received principal reductions totaling $185.6 million - or roughly $74,000 apiece.

Fannie and Freddie say the elimination of the matching requirement allowed them to participate in the principal reduction program, but servicers are still gearing up to accept the payments.

GMAC is on board, they are processing manually," Richardson says. "I think BofA will be on board in early November." She says the other large servicers have agreed verbally to accept the payments but couldn't say when.

BofA's program

BofA "is preparing to launch a new Hardest Hit Fund recast program for underwater customers in November," BofA spokesman Rick Simon says. "This program provides a one-time contribution through the Hardest Hit Fund to eligible customers to reduce their loan balance.

"Monthly payments are recalculated based on the new lower balance. There is no change to the mortgage rate or term." He says Fannie and Freddie loans will be eligible for the recast program, but state housing finance agencies will control eligibility, application and approval.

Wells Fargo spokesman Tom Goyda says, "We continue to work through the details of how Keep Your Home California funds would be applied to the principal on loans controlled by Fannie Mae and Freddie Mac, but are not yet able to do principal reduction modifications on Fannie and Freddie loans through the program.

"We have participated in a Nevada program that allowed borrowers to apply some of that state's Hardest Hit Funds to reduce the balance of a loan as part of a Harp refinance."

The Federal Housing Finance Agency says it has not changed its stance against permanent principal reductions. "Under the California program, the Hardest Hit Funds are paying off some amount of the outstanding loan balance; Fannie Mae and Freddie Mac are not reducing principal and are not sustaining any losses," agency spokeswoman Corinne Russell says.

In contrast, principal reductions under the Home Affordable Mortgage Program "would have resulted in substantial losses to both companies, both in the form of reduced principal and also from the infrastructure and systems costs."

Read more: http://www.sfgate.com/business/networth/article/Principal-relief-for-stressed-homeowners-3986774.php#ixzz2B7JFbr5H

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