U.S Treasury’s Refinance Initiative To Benefit Loan Modification San Diego Homeowners
Refinancing Initiative:
Under current rules, those families who own less than 20% equity in their homes have a difficult time refinancing and taking advantage of the historically low interest rates. Therefore, the refinancing initiative in the new plan provides refinancing help for homeowners with less than 20% equity in their homes or who owe more than their home is worth. This will reduce the need for a loan modification. Loan modification San Diego Homeowners to benefit. This initiative is open to homeowners who have conforming loans which are guaranteed by Fannie Mae and Freddie Mac. who owe up to 5 more than their home is worth.
According to the plan, it offer assistance to as many as 7 to 9 million homeowners making a good-faith effort to stay current on their mortgage payments “creditworthy” or “responsible” homeowners can refinance their mortgage into a 30- or 15-year, fixed-rate loan based on current market rates. The refinanced loan, however, cannot include prepayment penalties or balloon payments. This will benefit homeowners from resorting to a loan modification for assistance. For many families, including loan modification San Diego homeowners this low-cost refinancing may help their mortgage payments by up to thousands of dollars per year. Homeowner Affordability and Stability Plan will support a recovery in the housing market and ensure that these workers can continue paying off their mortgages.
The Plan:
- A Loan ModificationProgram To Reach 3 to 4 Million Homeowners
- Shared Effort with Lenders to Reduce Interest Payments.
- Incentives to Servicers and Borrowers.
- Required Participation By Financial Stability Plan Participant.
- Modifications of Home Loan Modification During Bankruptcy.
- Support Low Mortgage Rates by Strengthening Confidence in Fannie Mae and Freddie Mac.
- Provide Access to Low-Cost Refinancing for Responsible Homeowners Suffering From Falling Home Prices.
- Clear and Consistent Guidelines for a Loan Modification Program .
- Support Local Communities and Help Displaced Renters.
These will benefit all loan modification San Diego homeowners, renters and local communities. An occupied home is good for everyone in the communitie.
Mortgage rates are at 40 year lows. Under the program more homeowners will be able to refinance their homes at a more affordable rate, lowering their monthly mortgage payment. “For many families, a low-cost refinancing could reduce mortgage payments by thousands of dollars per year. For example, consider a family that took a 30-year fixed rate mortgage of $207,000 with an interest rate of 6.50% on a house worth $260,000 at the time. Today, that family has $200,000 remaining on their mortgage, but the value of that home has fallen 15 percent to $221,000 – making them ineligible for today’s low interest rates that generally require the borrower to have 20 percent home equity. Under this refinancing plan, that family could refinance to a rate near 5.16% – reducing their annual payments by over $2,300.”
As with the rest of the plan, including loan modification San Diego applications about this initiative will be released at a future date on March 4, 2009—including what, if any, credit score requirements will be included.
Full details can be found here: U.S Treasury- Full Article
