Archive for October 14th, 2008
New FHA Refinance Loans Providing Financial Relief for Homeowners
Posted by: | CommentsWith all of the hype regarding the $850 billion bailout of the financial sector many people have overlooked the new FHA home loan that is designed to prevent foreclosures and help homeowners get back on their feet. This new FHA home loan program, Hope for Homeowners was passed by Congress passed last summer and President Bush signed it into law on July 30. The Federal Housing Administration officially took control the mortgage program on October 1st. According to California mortgage broker Jeff Morris, “For most borrowers its refinance or renegotiate into a lower monthly mortgage that they can afford.”
Hope for Homeowners, also known as FHA- H4H enables bad credit borrowers and those in jeopardy of losing their home in a foreclosure to refinance their mortgage into 30-year home loan with a guaranteed fixed rate. Like other FHA mortgages, they are insured by the government. Meanwhile, FHA lenders have agreed to renegotiate and “write down” the loan principal to 90 percent of the property’s present appraised value, which in most cases is significantly lower than the original purchase price and existing mortgage balance. Clearly the government has been actively creating mortgage products to help fight this foreclosure epidemic.
