Aug 232011
 


What Implications Does The Making Home Affordable Program Have For You? 

Making Home Affordable SignatureMillions of Americans across the nation are losing their homes after having problems with keeping up with their mortgages. This has primarily been a result of the widespread unemployment and fall in home values across the country. Fortunately, the Obama administration has come out with unique mortgage relief programs to help all those who are at the verge of losing their homes to banks with whom they have mortgaged their homes. This unique plan is called the Making Home Affordable Program.

Let us take a look at what this plan really is and what impact it is going to have on you. The Making Home Affordable Plan is basically a two step approach aimed at helping and protecting the interests of the home owners. Continue reading »

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Aug 142011
 

Loan ModificationMaking Home Affordable Program has a special loan modification program for people who are on the verge of losing their home to mortgage companies. This program is aimed at helping those who have defaulted on their mortgage payments and are facing the risk of foreclosure.
Under this loan program, qualifying home owners can get their homes refinanced at a lower rate of interest. Here are some important fact relating to this loan modification program that has been initiated by the United States Government on the behest of President Obama.
  • The program is being sponsored by the federal government and billions of dollars of aid has been earmarked for use in this program, including the HARP loan refinance program.
  • If you owe more than the current value of your home, pursuing a loan modification program is bound to benefit both you and your bank. You would be benefitted in the way that you would get to keep your home and the bank would be benefitted in the way that it would not lose its loan amount.
  • Not all borrowers are eligible for assistance with this mortgage relief program. While most people say that this program includes anyone who is about to lose his or her home, this is not the case. There are certain pre-conditions or qualifying criteria that needs to be met in order to avail the facilities under this program.
  • This program is a way to explain to your lender your situation and to describe the reasons as to why you have not been able to pay your mortgage on time. So it is best to attach any back up documentation that you have to show your inability to pay the mortgage on time.
  • The program would provide you with a payment program that is easier on your pocket. Your target payment needs to be calculated according to your current income and paying capacity so you need to discuss with your bank on terms that would protect you from defaulting on your loan in the future.
  • Contrary to rumors, your loan modification application would be carefully reviewed by your lender before he or she decides to include your application in the loan modification program. Hence make sure that everything has been disclosed and is correct.
  • The government or the federal system is not going to contact you to apply for a loan modification program. Also since the program is going to be offered to a limited number of people it is advisable to apply as early as possible so as to have maximum chances of being included in the program.
  • Your lender would require some proof from your side that you would be able to pay your new installments after your loan is modified by your lender. For this you would have to supply to your lender all the documentation that is required.

These are some very important facts which you need to remember before applying for a loan modification procedure under the Making Your Home Affordable Program, including both the HAMP and HARP. The program is a great opportunity for people who are on the verge of losing their homes and can be very helpful for those who have no other place to go to.

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Aug 012011
 


Mortgage relief programs are providing much needed assitance due to the crisis in the housing market that has seen record numbers of foreclosures and homeowners who find that they are underwater on their home loan. These programs, however, are not always easy to obtain or even to understand.

Finding the appropriate program for mortgage assistance, or even a loan modification or mortgage relief plan is a daunting task, however, as a spate of programs have been introduced in the past year, some of which have expired and others of which are nearly impossible to qualify. The homeowner who attempts to dig out from a financial hole, caused by the failing economy and falling home prices needs to examine all of the options available, whether they are Federal Mortgage Relief programs, state loan assistant plans, HARP Loan Refinance Program, the HAFA program or some other government assistance.

Finding a Mortgage Relief Program

It hasn’t been too long since there were new mortgage assistant plans and loan modification programs coming out of Washington on a monthly basis.  These programs each had official sounding acronyms like HARP, PRA, HAFA, HAMP,etc., each designed to rescue floundering homeowners, prop up the nation’s real estate problem and re-energize the nation’s economy. For the most part, these programs have been a failure and have only reached a small portion of their intended target.

The Obama Refinance Program, as reported by the FHFA, still has programs available for homeowners looking for assistance.  It’s still possible to find information on programs that can lower your payments, lower your rates or get help if you are unemployed or have a home that has fallen in value.

It’s imperative that you understand all of the options that are still available.  Many banks and lending institutions have departments set up to lead you through their loan modification programs, mortgage relief plans or refinancing options. Make sure you talk with someone who is well-versed on all the programs that are still an option including the HAMP, HARP and FHA refinance for borrowers with negative equity.

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Jul 252011
 

The reverse mortgage is not necessarily a common option for homeowners to pursue, in fact, it’s really limited to the people who are eligible for this type of loan; however, it can be a very viable solution to a great number of people.

Essentially, a reverse mortgage is a way for homeowners older than 62 to acquire equity from their home without having to actually sell the house or move out. The basic idea is that the general flow of money is “reversed” from a conventional lending situation. Instead of paying a lender a mortgage payment to purchase a home, a homeowner will receive payments from the mortgage company.

The specific terms and arrangements of a reverse mortgage are quite varied. Homeowners, for instance, can acquire the funds in a lump sum, receive monthly payments, or draw the money from a line of credit. Because the details of a reverse mortgage can be so different and since these types of loans are not as common as standard mortgages, it is best to work with a company that specializes in reverse mortgages.

Allrmc.com is an example of a company that focuses their business on the reverse mortgage, and all of their staff members are experts on reverse mortgages. You can find a great deal of information on their website including a set of pdf guides with tons of information on the ins and outs of a reverse mortgage. When you’re ready to talk to someone they have staff to talk to in order to see if this is something that fits your specific needs and situation.

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Jun 132011
 


I’ve been seeing an increasing number of “For Sale” signs around town with the Homepath logo underneath the sign, leading me to wonder “What is a Homepath Mortgage?”

Basically, and this according to Homepath.com, it is a program that allows borrowers to get a loan with a low down payment and flexible loan terms on qualifying properties, namely Fannie Mae homes. These would be homes that have been foreclosed and are now owned by the bank.

A home sold under the Homepath mortgage program is sold as-is but there are many advantages to buying a home under this program:

  • A low down payment of at least around 3%.
  • Less stringent credit requirements make it easier to qualify for.
  • Flexible loan terms such as a fixed or adjustable percentage rate.
  • No appraisal on the property needed–this can save you hundreds of dollars.
  • No mortgage insurance required–this will also save you a lot of money.
  • Available for both primary residences as well as investment properties.

The downside to a Homepath loan house is that the interest rate is generally a bit higher than a conventional loan.  Also, not every lender handles these types of loans.  You have to obtain your financing through a Homepath Mortgage lender.

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Apr 132011
 

Recasting Home LoanRecasting your mortgage might be a great way to save money every month on your monthly mortgage payment. It’s a little know strategy, but if you can recast your home loan you can lower the amount you pay each month, sometimes by a substantial amount.

What is recasting?

Basically, recasting your mortgage (or re-amortization) is paying of a large, lump sum amount and then having the monthly payments refigured based on the existing interest rate and and time schedule.  Typically, if you pay off a large sum of your principal, the length of the loan will be shortened–the more you pay the shorter time you will have to pay and the less you pay in the end.  This is certainly a good long-term strategy and has benefits as well.  However, if you’re looking to lower your monthly payments, you can request you mortgage lender to recast your loan.  This will keep the time frame left on the loan intact (as well as the interest rate) but the monthly amount you pay will be lowered to reflect the new balance.

Assuming your lender provides this service (not all do unfortunately), they will typically charge some sort of recast fee, typically $150-$500, and may request a minimum amount applied to the principal, something like $5,000 or so in most cases.  There are often other restrictions and these can vary depending on your lenders own rules.  Obviously, you need to contact your mortgage lender to determine the rules and fees that apply to your case.

Before you decide that recasting your mortgage is right for you, spend some time with a mortgage calculator and figure out exactly how much this will save you every month, as well as how much it will cost you in the long run.  Also, if you’re paying a high interest rate, it might be better to refinance at this point to get into a more affordable loan for the long-run.

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Mar 202010
 


Many homeowners are faced with question of whether it’s a good idea to pay down their mortgage if they have some extra money. The benefits are many. Most importantly, you can reduce the length of your loan. If you simply make an extra payment or two, especially early in the loan, you can take quite a bit of time off your mortgage. The more you pay down and the earlier you do it, the better.

However, it might not actually make sense to pay down your home loan. There are quite a few factors involved when making this decision. You need to first do the basic calculations about how much you owe, how long the loan remains in effect, what your current interest rate is and what your other outstanding debts are. As mortgage rates fall lower it makes less sense to pay down your loan. Likewise, if you have credit card debt that is a higher interest rate you need to pay that down first.

Still, even after you’ve made some basic calculations, you need to dig a little deeper. Remember that payments on the interest of your home loan are tax deductible. The less interest you pay the less of a deduction. You need to figure this into your overall savings when you pay down the principal of your loan. The NYTimes has a good article on the details of this decision.

Ultimately, it boils down to numbers of course, but there is the emotional element involved with a home mortgage loan that is not always found elsewhere and which will usually play into your decision. It simply feels right to put some extra cash toward that mortgage. The idea of possibly paying off your house in 25 rather than 30 years is a notion that can’t always be quantified.

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Mar 152010
 

The recession has certainly caused more than just a bit of pain for consumers and especially for home owners. However, as a result of mortgage rates that continue to fall and have reached some of the lowest rates seen in a long time, it is becoming a perfect time to refinance.

The great difficulty at this point in choosing the best method to refinance your home is finding exactly where to seek these funds. Refinance.com is a great place to begin your hunt for the best refinance rates as well as basic guidance and a host of other resources. They offer resources like clear and informative articles on why someone should refinance, basic myths about the process, how to determine whether you’d want a fixed or ARM loan and much more.

One of the key differences that Refinance.com offers from other such services is that they help guide you through the process rather than simply shuffling you off quickly to a lender. During the application process, they allow you to take a peek at your credit report that includes your score through Experian. If your credit score comes up a little low, they advise ways to improve it. They take the time to offer you suggestions to make your loan application more appealing to lenders and thus ultimately more likely to be approved with good terms. Once they have helped you craft your application you can choose amongst the best offer and submit an application with that company.

Remember, a Mortgage Refinance is not a simple decision that should taken lightly. But the fact remains, if you do your research, find the right lender with the right terms and know the purpose of your refinance, it can save you money and should be pursued. It’s impossible to predict the future and no one knows where mortgage rates are headed, but they are clearly low now.

Take some time to check out Refinance.com’s homepage, watch their short video on the process and if you like what you see submit a free application.

Disclaimer

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Dec 142009
 


The HARP loan program, (Home Affordable Refinance Program), has received quite a bit of press recently, but is largely considered to be a failure, at least at this point.

The HARP program was designed to help some 4 to 5 million homeowners refinance their mortgages in order to reduce their payments and stay in their homes. The guidelines of the HARP program require, among other things, the homeowner to have a loan owned by Freddie Mac or Fannie Mae and the home to have a LTV (Loan-to-Value) ratio of no more than 105%.

Although the program was unveiled to great fanfare, the results have been less than stellar. The main sticking point here being that lenders are not required to make the loan even if the homeowner qualifies under the terms of HARP. That is to say, despite the appropriate and complete qualifications, the lender can simply deny the loan.

The Obama administration has recently urged lenders to free up credit and make these loans, but the results are still to be seen.

As home prices continue to fall an increasing number of homeowners are finding the LTV ratio on their home reaching the 125% mark or worse. Lenders are simply too skittish at this point to make these loans and are finding little incentive to begin any time soon.

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Feb 272008
 

Considering that many homeowners either locked into a high mortgage rate years ago or find themselves in an ARM that is about to change their rate for the worse, a bad credit mortgage refinance might be a great option. One of the most convenient and painless ways to refinance your home mortgage, even if you have bad credit, is to utilize the services of Refinance.com.

A bad credit home refinance is an option that will help build up your credit and reduce your home mortgage. Refinance.com understands that sometimes good people find themselves with bad credit and a high interest home mortgage. Sometimes circumstances that are outside of your control or sudden and unexpected emergencies arise that put you in a bad situation and adversely affect your credit rating. If you have a lackluster credit history you can still refinance your home mortgage by providing a written explanation of all the credit mistakes that mar your account.

At Refinance.com, you can fill out an easy form for an instant refinance quote through their website for your home refinance bad credit. You can also access some handy tools like a refinance calculator as well as lots of information on their bad credit mortgage refinancing programs. The experts there know that you don’t want to foreclose on your home and that you should be able to refinance your home mortgage loan even if you have less than stellar credit.

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Dec 182007
 


The Fed has recently approved a plan that would make mortgage lenders more thoroughly verify that lenders can actually afford the mortgages they take. Additionally, mortgage companies would have to completely reveal any sales fees that were hidden and then rolled into the interest payments. The New York Times reports, “The proposed changes, which do not apply to standard mortgages for borrowers with good credit, stopped short of banning all heavily criticized practices in subprime lending and did not go as far as many consumer groups had sought. But they won praise as worthwhile steps from some industry critics who had long complained that the Federal Reserve under its former chairman, Alan Greenspan, persistently ignored signs of trouble.”

The Fed has taken quite a bit of criticism for the sub-prime mess and this looks to be a step in possibly preventing future problems in this arena.

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Dec 182007
 


When I was looking for a house about a year ago, I also spent a lot of time trying to find a good deal on mortgage loans. It wasn’t nearly as easy as it seemed. There were hundreds of sites to look for information and to get quotes, but I could never dig too deep at any one site. I had to hop around from page to page looking for what I needed to learn about mortgages and get just the right information on all the financial topics I needed.

A useful resource for a wide variety of financial and credit information, including a bunch of good stuff on mortgage loans can be found on our site. In addition to general information there are some handy tools like mortgage calculators and applications for several different types of loans and lines of credit.

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Nov 012007
 


Well, the big news yesterday was the FOMC’s decision to lower the target rate for the Fed funds rate 25 basis points from 4.75% to 4.5%. Many homeowners, or potential homeowners, looking to either refinance or get into a new mortgage might think that this is good news for them as it surely means mortgage rates will also drop. Oddly enough, however, this is not really the case.

The Fed funds rate is the Fed’s tool to try to exert some control on the economy. That is, to either rev it up a bit when things are slowing down or to perhaps reign in inflation when things are getting too hot. Recently, we’ve seen the US economy beginning to slow down, largely due to problems in the housing sector and the credit markets. The Fed fears that if the economy cools off too much we’ll head into a recession. Technically, a recession would be a decline in the Gross Domestic Product (GDP) for two or more consecutive quarters, although that definition is not universally accepted. Regardless, the Fed tries to stimulate things a bit when there is a slowdown by lowering the fund rate to encourage borrowing and get things going.

The Fed fund rate is only indirectly tied to mortgage rates. Speaking broadly and over time, when the fund rate falls 30 year mortgage rates tend to go down as well and vice versa, but not always. The fund rate is more directly tied to adjustable rate mortgages, car loans, credit card interest rates and similar credit areas. Longer term mortgage rates might actually move in the opposite direction than the fund rate, counter intuitive though that be. The reason being that the 30-year fixed mortgage rate is more or less determined by the price of the 10-year Treasury note. That is, the yields on the 10 (and even 30) year Treasury notes are used to set the longer term mortgage rates like the 30-year fixed.

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Oct 182007
 


I’ve been posting recently about some of the problems in the real estate world and I’ve found it’s extremely relevant to personal finance right now. The credit market woes and in particular the sub-prime mortgage fiasco has affected all of the markets and basically the entire economy. In order to better understand the implications within the mortgage arena I’ve been hunting around for some good information, particularly about mortgage help from an insider.

Fortunately, I stumbled upon The Truth About Mortgage.com, a new blog dedicated to everything mortgage written by someone who worked within the mortgage business and has some great inside knowledge. There is a ton of information on this site, all relevant to the mortgage field. In addition to some in depth blog posts, there’s an index filled with a lot of great entries on topics like buying down your interest rate, what causes mortgage interest rates to move, and a bunch more just like these.

Ultimately, the mortgage business can be pretty intimidating to a lot of people, especially someone hunting for their first home. I think now, more than ever before due to the shakeup in the mortgage world, it really pays to do your research and learn everything you can about what the market entails. TheTruthAboutMortgage.com is an excellent educational tool in this area and would serve anyone well who is in the market for a home, a refinance or just looking to learn more about mortgages.

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Oct 022007
 


The recent shake-up in the credit markets has really changed the mortgage world. The salad days of the last few years are now behind us as mortgage companies batten down the hatches and work through these lean times. However, the world marches on, and people still need to find mortgages. Whether you need to relocate due to work or family or simply need a different size house, you’ll have to go through the process of finding a home loan.

I really suggest that rather than just take the first offer that comes your way that you spend some time and compare mortgages. You’ll be doing yourself a favor in the long run as you’ll make sure you’ve found the best deal. Without a comparison between a few companies, you’ll always wonder what else is out there. In order to find a good mortgage you should take the time to make the comparisons between a few lenders and choose the one that best fits your needs.

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