US Government: Making Home Affordable Refinance

On Tuesday details of President Obama's Housing Affordability Plan became available to the public.  The program is still in the very early stages of establishment which means that although there is some information available there isn't enough to make sense of it all.  Currently there is a website set up that provides some good information to determine if one is eligible for the program.  However, it's important to know that the government's website will just tell you to prepare some documents that will help your current lender decide if your eligible for any help from this program.

The program outlines two essential goals to this program:

• Making Home Affordable Refinance
• Modification Options

For nearly a year we've been hearing the federal government make claims about encouraging lenders to modify existing loans they service in order to help homeowners avoid foreclosure.  At this point the government has stepped it up a bit and is now encouraging banks andservicers to not only modify loans, but also refinance loans for those who have been responsible.  The modification has been geared towards those who are already late on their mortgage.  The Making Home Affordable Refinance is geared towards those homeowners who are currently "underwater", as the government is now calling it.  This means that the lenders will help borrowers refinance if they owe more than the value of their home.  However, if the loan is greater than 5% of the value of the home, the borrower may be unable to take advantage of this program.

This quick fact sheet gives a basic outline to the new program.

To check eligibility or to see more details about the program visit financialstability.gov. The website encourages you to contact your lender after gathering pertinent information.  Since the details are still somewhat vague and the program is still new, you'll have to be very patient with your lender as they will likely have little detail about how the process will work at this time.