Archive for Home Affordable Refinance
Home Affordable Refinance Program Unleashed
Posted by: | CommentsUnderwater homeowners have new possibilities with the Home Affordable Refinance Program 2.0. There is no longer loan to value limitations with the HARP mortgage program. Loan to value is no longer restricted to 125% by Fannie Mae or Freddie Mac. If you have a mortgage that is owned by Fannie or Freddie and find yourself with a mortgage greater than your property’s value, you should submit your application for mortgage refinancing with HARP.
Are HARP Loans Avaiable Now?
Yes. Mortgage lenders are currently offering the Home Affordable Refinance programs with the expanded guidelines enabling for loan to value’s beyond 125% with no cap.
- No mortgage delinquency allowed in the most recent 6 month period, with only one delinquency allowed in months 7-12 in any eligible loan.
- The requirements that the original home loan must have met the bankruptcy and foreclosure policies in effect at the time the loan was originated has been removed by FNMA.
- Fainnie Mae is updating the borrower benefit requirement to include a reduction in interest rate or reduction in loan amortization as eligible borrower benefits
HARP Mortgage Resources:
For more information directly from the agencies regarding these newly expanded products please feel free to review the direct updates at the following links:
Sluggish Housing Continues with Underwater Mortgages
Posted by: | CommentsThe discussion of homeowners who are stuck with underwater mortgages is an important one because in the past people who own real estate typically spend more money. With our economy on the brink of a double-dip recession, many economists are keeping a close eye on the housing sector and the quarterly data as it is released. CoreLogic reported that 7 out of 10 homeowners with less than 20% home equity in their real estate investment are paying above market levels on home loan interest rates and may be unable to refinance in order to take advantage of the current record low rates.
Will the New Home Affordable Refinance Guidelines Help Millions of Struggling Homeowners? Many lenders are concerned that Fannie Mae and Freddie Mac continue to postpone the release of the HARP program that promised to have no loan to value restrictions. The first version of the HARP mortgage extended refinancing to borrowers up to 125% loan to value, but the new and improved HARP loans will have no restrictions. For example if a borrower has a $350,000 mortgage on their home in California that is only appraised for $185,000, the borrower would qualify to refinance into a low fixed rate as long as they meet the HARP requirements. (Qualified home mortgages must be owned by Freddie Mac or Fannie Mae and this option is only for 1st mortgages. Borrowers can not include a 2nd mortgage lien in their refinancing endeavors)
Don’t Wait to Refinance! There is no consistent data indicating that the housing crisis is going away. The housing data company also reported in their report highlighted negative equity indicating that 10.7 million, or 22.1%, of all residential properties with a mortgage were underwater at the end of the 3rd quarter of 2011. This is down a bit from 10.9 million homes in the 2nd quarter. An additional 2.4 million borrowers are below 95% loan to value in the third quarter. Keep in mind that guidelines for FHA mortgages require the minimum loan to value and purchase and refinance loans at 96.5%. Together, negative equity and near-underwater home loans accounted for 27.1% of all residential properties with a mortgage nationally in the 3rd quarter, down from 27.5%in the previous quarter.
Relief for Refinancing with Short Refinance and Emergency Homeowner Loan Programs
Posted by: | CommentsHome loan relief is becoming more controversial as the Obama administration continues to make moves to forgive mortgage debt with short refinancing initiatives that will write-down home loans for homeowners that find themselves stuck with underwater mortgages. Republicans and Democrats alike are complaining that Obama is trying to buy votes with debt forgiveness.
With home mortgage rates at the lowest point since Freddie Mac began tracking interest rates, what more can the Federal Reserve do? The Fed has little power left to lift the economy out of its rut. Congress, with an election looming, has no appetite for more stimulus. Typically, the Fed can lower home loan rates in an effort to stimulate consumer spending in hopes that it will invigorate the economy. But the benchmark interest rate controlled by the Fed has been almost zero percent for more than a year now.
The Obama administration already funded the Home Affordable Refinance Program that enabled mortgage refinancing to 125% on select Fannie Mae and Freddie Mac mortgage portfolios in an effort to combat the highly deflated home values that have prevented many Americans from being approved to refinance into a more affordable fixed mortgage payment.
| Eligibility for the HARP home loan relief was difficult and not enough homeowners met the requirements set forth to refinance their underwater mortgages.In a recent article, Deutsche Bank indicated that there may be 20 million underwater mortgage loans that are outstanding by the end of 2011. This puts a significant amount of pressure on homeowners that are already struggling with high unemployment and tighter loan guidelines. |  |
Now the government has given HUD the authority to approve an FHA short refinance option that actually reduces the principal mortgage balances. FHA insures home mortgages, but the agency has nearly used their emergency loan reserves. Who do you think is paying for this? – - Yes the U.S. tax payers will be picking up the tab on this mortgage bail-out initiative as well. And if that’s not enough risk for the government, they also agreed to another mortgage relief initiative with the Emergency Homeowner Loan Program that is designed to help self-employed and un-employed homeowners for six months.
The Fed announced this week they it would use the proceeds from its huge portfolio of mortgage securities to buy government debt. The idea is to make cheap credit even more affordable, particularly for things like mortgage loans. The problem is that Americans who are worried about job stability, not to mention volatility in the stock market, don’t want to borrow. They saved 6.2% of their disposable income this spring.
Sure, the Federal Reserve still has options. It could launch another trillion-plus-dollar program to buy government debt or mortgage securities like it did when it was battling the recession and financial crisis. But the Fed is unlikely to commit that much money unless things get a lot worse. Plus there are risks. Regulators are resistant to push interest rates on low rate home loans because they don’t want to artificially jump-start the housing sector like what happened that inflated the housing bubble. The Fed could slash the rate it pays banks to zero in an effort to keep money parked there, a move aimed at getting banks to lend more, but banks are not exactly feeling cash-rich, either.
As reported previously, home mortgage rates have fallen to record lows. 15-year mortgage rates fell to 3.92 % this week and rates on 30-year mortgage loans were published at 4.44 %. Still, consumers aren’t in a mad rush to purchase homes and most homeowners are unable to meet the tighter guidelines for FHA refinancing. HUD is considering implementing a minimum credit score and FHA guidelines may start requiring these higher risk borrower to put as much as 10% up for down-payments in an effort to stem foreclosures and loan defaults. Many mortgage lenders believe that if the loan requirements were loosened for a period to get the distressed homeowners approved for refinance loans or loan modifications that our housing sectors will rebound locally and nationally.
Emergency Homeowner Loan Program
Posted by: | CommentsThe U.S. Department of Housing and Urban Development just confirmed that they will be launching a new $1 billon mortgage relief program called the Emergency Homeowners Loan Program. The Obama administration has extended several mortgage bail-out programs for distressed homeowners like the Home Affordable Refinance Program, but very few borrowers were able to qualify for this relief measure that enabled homeowners that had mortgages owned by Fannie Mae or Freddie Mac the ability to refinance their under-water loans up to 125% loan to value.
Bill Apgar, HUD Senior Advisor for Mortgage Finance said today, “HUD’s new Emergency Homeowner Loan Program will build on Treasury’s Hardest Hit initiative by targeting assistance to struggling unemployed homeowners in other hard hit areas to help them avoid preventable foreclosures.” Apgar continued, “Together, these initiatives represent a combined $3 billion investment that will ultimately impact a broad group of struggling borrowers across the country and in doing so further contribute to the Administration’s efforts to stabilize housing markets and communities across the country.”
Emergency Homeowner Loan Program to Help Refinancing Under-Water Mortgages
The Obama Administration today announced additional support to help homeowners struggling with unemployment through two targeted foreclosure-prevention programs. Through the existing Housing Finance Agency (HFA) Innovation Fund for the Hardest Hit Housing Markets, the U.S. Department of the Treasury will make $2 billion of additional assistance available for FHA programs for homeowners unable to qualify for mortgage refinancing as well as struggling to make their home loan payments due to unemployment.
The Emergency Homeowner Loan Program will offer loan relief and assistance for up to 24 months to homeowners to struggling homeowners who are at risk of foreclosure. This finance relief program is targeting homeowners who have experienced a significant reduction in income due to involuntary unemployment, underemployment, or a medical condition. “We remain committed to helping struggling homeowners, and this program will provide additional assistance to states hit hardest by unemployment,” said Assistant Secretary for Financial Stability Herb Allison. “This is part of the Administration’s comprehensive housing policy that has helped to stabilize a fragile housing market and allows responsible homeowners the chance to reduce their monthly mortgage payments to affordable levels.”
HUD extended the homeowner assistance and the mortgage relief will be in the form of a deferred payment also known as a bridge loan which can be used to help get a mortgage, taxes and insurance payment current. HUD has stated that the Emergency Homeowner Loan can assist struggling borrowers for up to 24 months. The loan relief funds will be provided under the Emergency Homeowners Loan Program and will be set aside for the individual states and Puerto Rico based on each states proportional share of national unemployment measures as applied to homeowners.
Eligibility: To be eligible for the program a household must have had an income, prior to the event which caused the delinquency, equal to or less than 120% of the Area Median Income and a post-event decrease in income of at least 15%. The homeowners must be at least 3 months delinquent on home loan payments on their principal home and have either received a foreclosure notice or be able to self-certify to the likelihood that they will default on their mortgage due to the delinquency.
President Obama first announced the Hardest Hit Fund in February 2010 to allow states hit hard by the economic downturn flexibility in determining how to design and implement programs to meet the local challenges homeowners in their state are facing. Under the additional assistance announced today, states eligible to receive support have all experienced an unemployment rate at or above the national average over the past 12 months. Each state will use the funds for targeted unemployment programs that provide temporary assistance to eligible homeowners to help them pay their mortgage loan while they seek re-employment, additional employment or undertake job training. States that do not currently have Hardest Hit Fund unemployment programs must submit proposals to Treasury by September 1, 2010 that, within established loan guidelines, meet the distinct needs of their state.
Mortgage Refinancing Benefits
Posted by: | CommentsMortgage refinancing can offer significant opportunities for homeowners to save money and get access to cash. Through home refinancing, it may be possible to reduce your monthly home loan payments and provide the ability for you to own your home outright quicker. Consider the peace of mind you obtain by refinancing an adjustable rate mortgage into a mortgage featuring a fixed interest rate. Many homeowners have benefitted from the debt consolidation option that is available with most cash out refinance loans. We recommend consolidating variable rate credit debt into a fixed rate home equity loan or mortgage.
- Record low rates starting at 4.625% fixed
- FHA refinance programs offer additional flexibility
- Choose from 30 and 40 Year fixed rate terms
California Mortgage Rates Rebounding
Posted by: | CommentsAccording to California mortgage lender, Bryan Dornan, “Record low rates have made a significant impact on the housing recovery statewide.” 30-year fixed California mortgage rates have been reported as low as 4.5% for conforming and FHA loans. Unfortunately for many local residents, California home loans are more difficult to qualify for because stated income and no document mortgages have all but disappeared. The higher California FHA loan limits have been able to broaden the scope for many new borrowers to qualify for refinancing.
Yesterday, the Federal Reserve announced they were keeping mortgage rates unchanged and extending the government mortgage buying program which is good news for Americans but great news for borrowers living in California. 2010 may be the year that California home values rebound and many distressed homeowners have found comfort with the Home Affordable Refinance Program because it enables borrowers with no equity to refinance their Fannie Mae or Freddie Mac loans up to 125%.
Fed Committed to Low Mortgage Rates for Refinancing
Posted by: | CommentsToday the Federal Reserve renewed their commitment to low mortgage rates in an effort to help the housing sectors rebound across the nation. Just a few months after the Obama loan relief rolled out the Home Affordable Refinance Program that enabled borrowers who were upside down refinance into a fixed mortgage up to 125% of the property’s value. The federal government continues their push for rate and term refinancing and it appears they will not let something petty like equity get in the way of qualifying for a refinance loan.
FHA mortgage rates remained below 5% on 15 and 30-year home loans again this week. While conforming and VA mortgage rates continued to hover the 5% realm for mortgage refinancing and new home purchase loans.
