Obama Expected to Unveil Housing Aid
The policies are said to contain legislation that would make it easier to qualify for HARP (Home Affordable Refinance Program). The HARP program is designed to help homeowners get caught up on their back mortgage payments in spite of deep reductions in their homes value.
The Federal Housing Finance Agency, which oversees Freddie Mac and Fannie Mae, is expected to lift a a law that excluded homeowners from HARP whose mortgages exceed more then 125 percent of the home’s current value.
There are a great number of borrowers who have been unable to refinance since they do not have any equity in their homes. Obama’s plan is supposed to do away with stringent underwriting guidelines for most homeowners who are current on their mortgage and who want to refinance to a lower rate.
The plan is supposed to provide Freddie Mac and Fannie Mae the ability to charge lower loan fees and do away with loan fees for those looking to refinance to shorter terms. These new policies could be in place by December 1st, but the loan-to-value limit may not be lifted until 2012.
The main idea is to make it easier to move to lower rates which will save the average homeowner a substantial amount of money each month.
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Paraphrased from the Daily Real Estate News | Monday, October 24, 2011