obama refinance mortgages
A little information on refinancing through Obama’s mortgage stimulus plan please?
Our friends down the street told us that they are currently in the process of refinancing their home for a fixed rate of 2% through Obama’s mortgage stimulus plan. Money signs instantly popped up in my eyes, because who wouldn’t love to save a few hundred bucks a month? Would we be able to qualify?
A little background info…we are not in any real “financial hardship” per say, but are a single-income family and our mortgage takes up about 1/3 of our income. We have a 5.75% fixed rate, down payment of $110,000 from 2005 and a Principal balance of $130,000. So our monthly payments are a little over $1,000 (including taxes & insurance.)
What kind of requirements need to be in place to qualify for this? Any help would be appreciated– thank you!
Guidelines say you must be experiencing a hardship. And though the Obama guidelines don’t require it, the lenders often will only deal with borrowers who at least 3 months behind on payments. That in itself could indicate there is a hardship.
Make no mistake, getting a modification approved by the lender is very difficult. If it were easy, we would all have one.
Modifications require the borrower to make payments under a trial program before final approval is granted. Your friend might be in the midst of the trial right now versus an official approval. If the trial payments are not made on time as agreed, the modification will not be approved and there are no 2nd chances. One modification per loan.
The interest rate can be reduced to a rate as low as 2% if that is what is required to get the debt to income ratio reduced to program requirements.
Instead of sorting through what’s right and wrong with the answers you get on Yahoo, your question is best answered by accessing the actual program information from the source. There are tons of “official” sources online. Here’s one: http://makinghomeaffordable.gov/
Good luck.
