The guest post is by Ann from Buxr.com, an online bargain hunting community. The site invites members to share online deals as well as discuss all kinds of questions related to money and finance.
In an effort to make good on his promises to establish a plan to bring the country out of the current housing slump, President Obama has started the Making Home Affordable program. In essence, the plan will, according to the Los Angeles Times, save the homes of some nine million or so Americans who are facing imminent foreclosure, or have become unduly strapped because of rising interest rates on their mortgages.
Some of those fortunate or responsible enough to have kept their mortgage payments up-to-date are seeing relief from Uncle Sam. The Making Home Affordable Refinancing program’s premise is simple: responsible, paying homeowners who had had a first mortgage with the now-defunct Freddie or Fannie can get a refinanced mortgage for up to 105% of their home’s true value. The 80% threshold of Fannie and Freddie pales by comparison.
The rules for getting the new loans are somewhat stringent. Besides the more obvious rules, such as requiring the borrower to have a job, and live in the home primarily, you have to owe more than your home is worth. You also have to have paid your monthly mortgage payment on time for the last consecutive twelve months. You cannot have a payment due that is more than 105% of the home’s true value.
The program will benefit people who have special circumstances, such as a balloon payment or variable APRs. People who have a fixed rate could actually be harming themselves because they may have locked in a lower rate than the current prime. If such is the case, the owner obviously would not save any money.
There is an alternative loan for those who are facing foreclosure, called Making Home Affordable Modification. This program has less strict standards, and is appropriate for homeowners who are about to be foreclosed upon. In fact, the rules for the loan are such that the borrower must be in pretty dire financial straits to qualify.
To see if you are eligible for either of the programs, go to the site MakingHomeAffordable.gov. Notice this is a government website. While viewing the site, take self-assessment tests to see if you qualify for one of the new refinancing loans. Even if you do you qualify for either of the assistance programs, you may still have to wait. Lenders are not required by law to participate, so only time will tell what kind of support the program will receive from loan institutions.
Post image by kevindoole
- Cash for Clunkers Program May Get More Funds – But is the Program Good for Consumers?
- Should You Refinance Your Mortgage?
- Pay Off Credit Cards With Home Equity: Secured and Unsecured Debt
- Would You Consider a Home Refinance to Pay Off Credit Cards?
- Quick! Go Buy a New Home! New $6,500 Homebuyer Tax Credit for Existing Owners and $8,000 for First-Timers Gets Extended
Hi and welcome to ptMoney.com. I'm PT. Please visit often, download my 
{ 3 trackbacks }
{ 0 comments… add one now }