Lenders are slowly starting to roll out the Making Home Affordable program, which will allow some homeowners to refinance their mortgages up to 105% of their home’s value. The background of this program can be found here.
First things first: You need to see if your loan is currently owned by Fannie Mae or Freddie Mac. You can find out through these two websites:
http://loanlookup.fanniemae.com/loanlookup/
https://ww3.freddiemac.com/corporate/
• If your loan is owned by Fannie Mae and you fall into all the other criteria, I may be able to help you.
• If your loan is owned by Freddie Mac and you fall into the other criteria, you must contact your current service provider directly; only they will be able to help you. (Your service provider is who you write your mortgage payments to).
Right now, lenders are only allowing a maximum of 95% LTV/CLTV. The 105% LTV allowance will not be rolled out until May 2nd.
UPDATE 4/8/09: Lenders are now going up to 105%, so this feature is available.
Some other items you need to know:
1. If you currently have Mortgage Insurance on your existing loan, you do not qualify for the Refi Plus program.
2. If you have a 2nd mortgage, the 2nd mortgage lender must agree to subordinate. You cannot pay off any 2nd mortgage balance with your new 1st Refi Plus mortgage.
May’s roll-out will bring many new features, such as the 105% max Loan-to-Value ratio with no restriction on Combined Loan-to-Values (if you have a 2nd mortgage), as well as no minimum FICO requirements and no maximum qualifying ratios.
Of course, remember that you are not going to get the optimal interest rates with this program. There will be pricing hits, so we will look at your situation together to determine if it makes sense to refinance.
More to come soon! Call or email me with your situation if you have specific questions.
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