New Home Refinance and Modification Options From the Obama Stimulus

Even though the economy and housing market are in bad shape, getting help to save you home from being lost to foreclosure or mortgage modification is easier than ever. New Government stimulus programs allow millions of homeowners new mortgage refinancing or modification opportunities which allow them to save money, their home, or both.In the past, homeowners with bad credit, an upside down mortgage, financial hardships, or other problems, would have a hard time getting approved for a mortgage refinancing or modification. The housing market was strong, and foreclosures were low. Now though, things are different. The market has tanked, leaving homes values at all time lows. This bad market has also created millions of homeowners who are unable to make their monthly mortgage payments, or are barely able to. This is creating a huge wave of foreclosures and home loan defaults, which makes the housing market, and overall economy, worse. Mortgage lenders and banks are now much more likely to help homeowners as opposed to letting them be foreclosed on. Foreclosures are no longer very profitable, and a lender or bank would rather take sure profits and help homeowners, then deal with another home they need to sell. This has created an environment which allows homeowners in bad situations to more easily get the help they need to save their home.Also, as a response to the millions of struggling homeowners who need help, President Obama has announced his “Making Home Affordable” stimulus plan. This $75 billion program allows homeowners in all types of bad situations to get the help they need to save their home. When a mortgage lender or bank approves a homeowner using this plan and following its guidelines, it will receive a cash incentive. This money allows them to assume more risk, and approve more homeowners for refinancing or mortgage modification, even if they are having financial or mortgage problems. The lender or bank who approved a homeowner for refinancing or modification will receive yearly bonuses, for up to 5 years, every year a homeowner is able to successfully make their payments on time and in full. This means that all types of struggling homeowners are now getting truly beneficial refinance or home loan modification options.Qualifying for the Government programs is pretty easy to do. Homeowners who have lost a job, or other similar financial problems will most likely be able to use this plan for mortgage refinance or modification themselves. Also, homeowners already in foreclosure or who have missed payments, can get help using this plan. Even homes that have dropped in value can get approved through these Government programs. Millions of homeowners are able to use this stimulus for themselves, and save their homes. Contact your lender or bank today and see how President Obamas “Making Home Affordable” plan can work for you.

Learn Your Options When Facing Foreclosure

Foreclosure is becoming one of the largest problems experienced by the citizens of the United States of America today! Incalculable numbers of homeowners that didn’t have problems in the past are now in default on their mortgage, risking losing the home they have worked so hard for, and feeling helpless! It’s happening because of the current economy and the fact that is still deteriorating. It’s lowering incomes, raising expenses, and the mortgage payment, as agreed is still due each month.Foreclosure doesn’t happen overnight, rather it takes time. This time can be more stressful for many, but also a motivation to find a better way when they miss their monthly payment. It’s when the missed payments become 60, 90 and more days late that it can go into foreclosure. Even at this point though there may be a way to fix the situation and get back on track. What follows are some possible fixes to this undoubtedly stressful situation that reality brings many!1) Home Loan Modification: This is fast becoming the most accepted and successful means to stop foreclosure today. The process involves the eventual permanent change of terms in the mortgage effectively reducing the monthly payment due. Among the terms that have been changed in past modifications are the term, interest rates, principle balance lowered, and waiving past due payments. A positive side effect is with successful future payment at the reduced payment, you keep your home and your credit score will work again towards higher levels.2) Refinance: If you have equity in your home (the principal balance of your current mortgage is significantly higher than its value) you may be able to find a new mortgage with a reduced payment and/or by increasing the term of the mortgage. When considering this option you will want to shop around for the best APR (and other terms), and being behind on your current mortgage may make the process more difficult.3) Reinstatement: In the process of foreclosure, you will usually be given the option of paying everything up along with additional fees to simply pick up with the next payment back in business as usual. This is often combined with Forbearance as the source for payoff will usually be predictable and the change in times may simply align with it consistently.4) Forbearance: This is where your lender agrees to reduce or eliminate your payment altogether for a specific time frame. This is often used when some unpredictable event has occurred (such as a layoff or other loss of income) that prevents you from making payments on time for a limited time. This is often combined with a repayment plan or reinstatement to catch up on the unmade payments.5) Repayment Plan: This option to catch up is when your mortgage lender allows you to repay missed payments on a schedule (in addition to your monthly payment). In some cases this may even be simply added to the loan extending it.6) Deed in lieu of foreclosure: In some situations the borrower can simply sign over the property to the mortgage lender and be exonerated of their mortgage debt and responsibilities.7) Short Sale: This is where the owner sells their home. If the amount the sale brings isn’t enough to pay the mortgage lender off, they may be prepared to accept a different payoff amount that is lower than the due balance.

Can Underwater Mortgages Be Refinanced?

Homeowners have watched anxiously as the values of their homes have decreased dramatically. Historically, when home values have dropped, we have seen the housing market bottom out and gradually begin to rise again. However, in our current economy there is no indication that homeowners are going to be able to recover from the enormous discrepancy between what they paid for their home and its current actual value. Approximately 25% of Americans are carrying mortgages that are underwater. And, many Americans are beginning to ask themselves whether they should stay in a home with an underwater mortgage or if they should just walk away.There are several factors preventing people from taking advantage of the lowest mortgage rates we have seen in a long time. The most prevalent reason is that the mortgage is underwater. The decreases in home values have left many people with little or no equity in their homes. Typically, if you do not have any equity in your home, you cannot refinance your mortgage. Additionally, qualifications for refinancing have become much stricter. The days of obtaining a “no documentation/no verification” loan are long gone. Lenders have also raised the bar on credit requirements. As more and more people struggle to survive in the current economy, credit ratings are falling. This increases the difficulty of qualifying for a refinance, even for people who are current with their mortgage payments.There are, however, some limited options for underwater homeowners. The Federal Housing Authority (FHA) and the Home Affordable Refinance Program (HARP) may offer opportunities to refinance. In order to qualify for these options, homeowners must be current on their mortgages. People who are delinquent with their payments need to try one of the loan modification programs first. The FHA and HARP programs are designed to help lower monthly mortgage payments. The biggest drawback to these programs is that the bank who holds the current loan must agree to write off a percentage of the mortgage principal. Many banks have been unwilling to do this, frustrating homeowners that are continuing to make payments on a home with negative equity.Another program requirement that is frustrating homeowners is the three-month probationary period. Once a homeowner has qualified for a refinance under the FHA program, the new mortgage payment is required to be made on time and in full. If the homeowner fails to meet this requirement, the new payment arrangement is revoked. However, if the payments were made on time, the homeowner is supposed to be granted this arrangement permanently. However, lenders have stretched this probationary period to six or even ten months. The unwillingness of lenders to uphold the three-month program requirement has left homeowners so aggravated that they walk away from the program even after they have qualified.Underwater mortgages can be refinanced if you are willing to put in the hard work. It takes a lot of patience on the part of the homeowner and willingness from your current lender to help you stay in your home.