My Financial Healthcheck

New home sales plunged 7.6% to a 9-month low in December, the largest decline was in the Midwest where sales were down 41% last year.  The existing home sales also sank 16.7% in December, many speculate that the decreases were due to the first time homebuyer credit that was set to expire in November.  New guidelines were announced by the Treasury Department that would require all paperwork be supplied before a trail modification would be approved.  Distressed borrowers will have to fill out a three-page request form that asks them to explain their hardship and list their income and expenses.  They will also have  to sign an IRS 4506-T form that allows servicers to pull their tax transcripts.  Applicants will have to verify their income with paystubs or tax returns.  Servicers must acknowledge receipt within 10 business days and if the file is complete let the borrower know within 30 days if their modification is approved.  Those approved will have to make three timely payments before getting a long-term modification.  So far some 787,200 homeowners are in trial modifications, a far cry from the 4 million homeowners the Obama administration had promised.  Las Vegas had the largest number of foreclosure filings of any city last year, with 12% of its households receiving at least one during the year, Cape Coral, Florida was second with 11.9% of its households.  Nationwide foreclosures grew 21.2% during the year.  Mortgage rates rose towards the end of the month with a 30 Year Fixed Mortgage rate being in the low 5% range.