Many people in who are current on their mortgage payments and want to refinance their home have spoken with their lender about the Obama refinance — where they can be up to 105% “under water” and still get a Fannie Mae / Freddie Mac loan.
What they are finding out once their appraisal comes back is that they are actually “under water” by more than 105% — and now they are trying to decide what to do. Should they just keep making payments at their high interest rate? Should they stop making payments and try to get a loan modification? Should they try for a loan modification even though they are current?
All of these are good questions - and really, there is no easy answer. There for sure is not an answer that will fit everyone’s situation perfectly — each situation is different and individual.
But…
There is a possibility — note the word possibility — that the guidelines on the Obama refinance will soon be expanded where you can be up to 125% upside down on your home and qualify for the Obama refinance.
It hasn’t been made official yet — but for many people who currently have been turned down by their lender and are trying to decide whether to:
- Just keep making their mortgage payments as normal
- Stop making payments and try to get a loan modification
- Try for a loan modification even though they are current
Now there is at least one more option on the table — wait and see if the Obama refinance guidelines get expanded.
According to Bloomberg:
Fannie Mae and Freddie Mac may get permission to begin refinancing mortgages with loan-to-value ratios above 105 percent as the Obama administration seeks to boost participation in its anti-foreclosure programs.
“We’re actively considering how to structure a program that makes sense over 105 percent,” Federal Housing Finance Agency Director James Lockhart said yesterday. He said a ratio of 125 percent “is a number” that’s on the table, though “not necessarily the number we’re going to end up with.”
Last 5 posts in Loan Modification
- Loan modifications are lowering monthly payments - October 4th, 2009
- More Homeowners are Late on Their Mortgages - September 21st, 2009
- Successful Short Sales…I mean plural…more than one! - September 14th, 2009
- FHA Mortgages Now Qualify For Government Help - September 3rd, 2009
- Loan Modification Slowdown - August 28th, 2009
- Stumble it!
- Categories: Loan Modification, Refinance
Comments
1 Comment so far
John
I feel like what the government and Obama promised just is not happening. The whole plan was to prevent over 4 million home owners from losing their homes. I don’t know where these 4 million are. There are huge neighborhoods by my house that are almost all facing foreclosures and they say that the banks just were not helping them prevent this but they were just covering their bases. Well if that is what is happening what happened to the huge bail out the government gave the banks to prevent this?
My friend was recently facing foreclosure and he went through http://www.Carrotpeel.com with an on staff attorney to help him out. He did not have any luck with the bank and he said they were able to work with the banks for him and save his home by lowering his monthly payments.
I hope there are some people out there who are having luck with the banks and that some of the stimulus money was spent like it was suppose to and not big corporate bonuses.