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The new refinance and modification details.
There have been a lot of reports in the media lately about the newest plan from the government to help people refinance or modify their loans. Details of these plans were announced today. I thought you might want some information to pass along to your clients.
The government has just come out with two programs that might benefit you. One is the Home Affordable Refinance Program & the other is the Home Affordable Modification Program. Here is a web site with a lot of information about both: http://www.financialstability.gov/
The refinance program is great for people who are making their payments on time but struggling. They want to refinance but their home values have declined and they no longer meet traditional guidelines for refinancing. These loans must be owned by FNMA or FHLMC. The first thing you need to do is to find out if your first trust is currently owned by FNMA or FHLMC. From the web site above click the borrower information link, then click the “find out if you are eligible” link. From there you can click links to both FNMA & FHLMC and fill out on line information forms to see if they own your loan. Also from this page you can click the next steps link that tells you what you need to do to move forward.
The Modification program is for people who are struggling paying their mortgage. They may be current on their payment or they may have missed a payment already, their loan does not have to be owned by FNMA or FHLMC.
Once a homeowner determines which option ( if any ) applies to them they need to gather up their financial information and call their loan servicer – where they make their payments – and discuss their situation.
Please keep in mind the loan servicer may not be set up to accommodate people yet - they just got this information today.
I hope this helps. Please call me if I can be of any help with mortgage financing for you or your clients.
The government has just come out with two programs that might benefit you. One is the Home Affordable Refinance Program & the other is the Home Affordable Modification Program. Here is a web site with a lot of information about both: http://www.financialstability.gov/
The refinance program is great for people who are making their payments on time but struggling. They want to refinance but their home values have declined and they no longer meet traditional guidelines for refinancing. These loans must be owned by FNMA or FHLMC. The first thing you need to do is to find out if your first trust is currently owned by FNMA or FHLMC. From the web site above click the borrower information link, then click the “find out if you are eligible” link. From there you can click links to both FNMA & FHLMC and fill out on line information forms to see if they own your loan. Also from this page you can click the next steps link that tells you what you need to do to move forward.
The Modification program is for people who are struggling paying their mortgage. They may be current on their payment or they may have missed a payment already, their loan does not have to be owned by FNMA or FHLMC.
Once a homeowner determines which option ( if any ) applies to them they need to gather up their financial information and call their loan servicer – where they make their payments – and discuss their situation.
Please keep in mind the loan servicer may not be set up to accommodate people yet - they just got this information today.
I hope this helps. Please call me if I can be of any help with mortgage financing for you or your clients.
Comment
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Comment by Christopher Jordan on April 27, 2009 at 7:12am -
If you currently have a conventional loan that is not owned by Fannie Mae or Freddie Mac and you do not have any lates, you should talk to your current servicer about refinance options.
If your current mortgage is a government loan, such FHA or VA and you do not have any lates, you could be eligible for a streamline refinance through any lender.
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Comment by David Chapman on April 26, 2009 at 11:09pm - So what happens if Fannie Mae or Freddie Mac don't own your loan? What options do you have?
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Comment by Christopher Jordan on April 14, 2009 at 11:16pm
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I do not know of any pre payment penalties or timeframes at this time. The Home Affordabiltiy and Stability Plan programs were designed specifically to prevent foreclosures, not to make money, so with that in mind, I wouldn't think that selling your home would be an issue if it was done after a refinance or modification to that saved you from foreclosure. However, a bank may not agree to a shortsale after they have already taken a huge loss through a modification.
The overall plan is so broad and every indivdual bank and investor that participates in these programs adds their own additional guidelines and restrictions. We are still in the beginning stages of attempting to use these programs and so far they harder to qualify for than you would think.
I have not seen anything in writing yet in the broad guidelines or indivdual investor guidelines that reference any pre payment penalty or occupancy timeframes, but that doesn't mean that they don't exist. I'll have to update you if I do come across that.
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Comment by Brian Turner on April 13, 2009 at 3:04pm - Chris - if you do a modification or refinance under the President Obama plan, what happens if you sell? Is there a certain timeframe or penalty??
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Comment by Christopher Jordan on March 4, 2009 at 7:20pm
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www.financialstability.gov
Then click on : Borrower Information: Making Home Affordable Refinance and Modification Options.
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Comment by Brian Turner on March 4, 2009 at 7:14pm
- I did not see no “find out if you are eligible” link. Please advise.
Quote of the Day
Franklin D. Roosevelt
"Men are not prisoners of fate, but only prisoners of their own minds."
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