Qualify for Obama’s Mortgage Refinance Program

Features of PresidentObama’s mortgage refinancing program

It is possible to refinance a home loan and avail new homeloan facilities through Obama mortgage refinance plan,and benefit with better interest rates, terms, and conditions. The mainadvantage, or highlight of the refinancing plan is that the loan facilityavailed can exceed 80% of the actual home evaluation value. As per older guidelinesand working, it was not possible for a home loan to be approved forrefinancing, if the credit facility to be availed would be for more than 80% ofthe home evaluation. Real estate and homes have dropped in prices, and mortgageinterest rates too have reduced, giving a clear indication that opting forrefinancing is a good option.

Qualifying for Obama’smortgage refinance program

Certain criteria or conditions need to be met, or fulfilledto qualify for the refinancing program advantages offered by the president. Theconditions can be briefly narrated as:

• The home to be refinanced should be lived in by the owner.It is the main prerequisite for availing the home refinance program.

• It is possible to qualify if the loan or mortgage iseither insured, or owned by Fannie Mae & Freddie Mac.

• The loan amount to be availed should be in excess of 105%of the actual or current valuation of the home, as carried out by any federalor state government recognized evaluation agencies. It is required to getmortgage refinance credit facilities.

• The existing mortgage status and condition must be up todate. From the monthly payments point of view, no payments within the past 12months should be late, or over 30 days overdue, or not paid altogether. Theactual monthly mortgage payments are officially limited to just 31% of thegross monthly income of the borrower. In addition, the total sum of creditpayments should not be more than 55% of the calculated pretax income of theborrower.

• The home loan value should be between 80%-105% of thecurrent or market value of the home. This value is also referred to as the LTVratio, or the “Loan to Value” ratio.

• The previous rule stating that while applying for the loanmodification or refinance facility, the applicant needs to own at least 20%equity of the current home value has been written off. The gesture is to makehome mortgage refinance affordable.

• The government has declared a $1000 cash benefit orincentives for all banks and mortgage establishments for every loan modification orrefinances application. This creates an impetus, and encourages banks to helpout the applicants.

• It’s possible to seek professional help from HUD appointedrepresentatives and counselors. They basically function as the applicant’srepresentatives for all dealings to be carried out with the bank, and representthe applicant’s case in the best possible manner to the bankers. They do notcharge for their efforts and work, since they are on the Federal Government’spayroll.