Tag Archives: refinancing

Real Estate

Mortgage Relief From White House – But You know Congress

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More mortgage relief from the White House – but congressional OK doubtful

In his State of the Union Address, President Obama laid out a plan to help responsible borrowers and support a housing market recovery.  Details of that plan were released yesterday.  However, funding for the proposed program must be approved by Congress, lowering the possibility that it will be implemented quickly.

Making sense of the story

  • Operated by the Federal Housing Administration, the plan would allow underwater homeowners to refinance into cheaper federally insured loans.  Borrowers with good credit who are current on their loan payments are eligible.
  • The measure also streamlines the process of refinancing an underwater mortgage, eliminating the need for an appraisal or submitting a new tax return.
  • To qualify, borrowers must be current on their mortgage, have a minimum credit score of 580, and must be refinancing a loan on a single-family owner-occupied principal residence.
  • Lenders only need to confirm that the borrower is employed.  Loans that are more than 140 percent of the home value probably would not qualify until banks wrote down part of the balance.
  • Congress must approve $5 billion to $10 billion in funding, leading housing experts to praise the plan’s objectives with skepticism of it passing this year.

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Real Estate

Troubled Homeowners Get A Lifeline

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The government is changing its Home Affordable Refinance Program (HARP), making it easier for homeowners to refinance their underwater, high-interest mortgages.

Making sense of the story

  • Although HARP has helped more than 890,000 homeowners nationwide by reducing their monthly mortgage payments, there are still millions of homeowners who are too far underwater to participate.
  • Under the new rules, homeowners who owe more than 125 percent of the market value of their homes will be allowed to refinance into new loans.
  • The program also streamlines the refinancing process for homeowners who are current on their mortgage payments and reduces or removes fees that previously hindered them from refinancing.
  • Fannie Mae and Freddie Mac also will reduce the fees they charged in the past to enable borrowers to better afford the new loans.  Among the fees that will be reduced or eliminated are those for appraisals, title insurance, and closing costs.
  • Fees also will be waived for some underwater borrowers who are refinancing into 20-year or shorter-term loans.
  • HARP is only open to borrowers who are current on their payments for the past six months with no more than one missed payment in the past 12 months.  The loans must have been originally issued before May 31, 2009, and purchased by Fannie Mae or Freddie Mac.

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Thinking of buying or selling?
For all your real estate needs
Email or call:

John J. O’Dell Realtor® GRI
(530) 263-1091
Email jodell@nevadacounty.com

Politics

How To find Out What Your Home Is Worth & Refinancing


Declining property values are preventing some homeowners from taking advantage of today’s historically low interest rates and refinancing.

 

  • Many homeowners nationwide have either no equity or are in a negative equity position in their homes.  This leaves them with two options for refinancing, paying extra at the closing or what’s known as a cash-in mortgage.
  • Those considering refinancing will need to determine the current valuation, comparing it with the mortgage balance.  If the balance is at least 15 to 20 percent higher than what is owed, a refinance without a second down payment is possible.
  • To obtain a good valuation, some homeowners hire an appraiser, at a cost of $300 to $600, or more on a large or expensive property.  While this may be informative, most lenders require an official appraisal anyway, and that will have to be conducted by someone on the lender’s approved list.
  • Another, less costly, option a homeowner can use prior to approaching a lender, is to check the comparable sales in the neighborhood and see which homes and for what amounts homes have sold in the last three to six months.
  • Homeowners also can go to the county assessor’s office and look up specific homes that have sold recently in the neighborhood.
  • When looking at comps, homeowners should consider homes with similar amenities and square footage as the property in question.
  • Just before the home is scheduled for its official appraisal, homeowners should spend a few hours touching up and making sure it looks well maintained.  Hiring a cleaning crew, repairing any broken windows, and providing documentation on upgrades also can help the appraiser.

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Thinking of buying or selling?
For all your real estate needs, call or email:

John J. O’Dell Realtor®
Real Estate Broker
O’Dell Realty
9530) 263-1091
jodell@nevadacounty.com

Real Estate

A Little Known Strategy for Cutting Mortgage Payments

Merlin The Dog Photo by Cheeriotown
Merlin The Dog Photo by Cheeriotown

Homeowners looking to lower their monthly mortgage payments and reduce their interest rate may be able to do so without refinancing.  A little-known strategy called recasting or re-amortization is available through some mortgage lenders and servicers, and eliminates the hefty fees and daunting credit requirements of refinancing.

  • Re-amortization requires borrowers pay off a lump sum of the principal amount on the mortgage and asking to have the monthly payments reset according to the original interest rate and loan terms.  The lump sum reduces the principal, so the new monthly payments decrease slightly and interest paid over the life of the loan is reduced.
  • Lenders typically charge an administrative fee of $150 or more to re-amortize a mortgage; however, borrowers are not required to pay closing costs or submit to another credit check.
  • Re-amortizing works well for homeowners unable to qualify for refinancing, especially those who are self employed or have low poor credit.
  • Homeowners consider re-amortizing their mortgage should be aware that some lenders require a minimum amount to be paid toward the principal in the lump sum.  JPMorgan Chase, for example, charges a $150 fee and requires a minimum $5,000 payment toward the principal.
  • Another challenge is finding a lender, or loan servicer, that offers re-amortizing.  JPMorgan Chase and Bank of America exclude loans backed by the Federal Housing Administration and Dept. of Veterans Affairs, and loans that were sold off and securitized may also need investor approval.

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    For all your real estate needs Call
    John J. O’Dell
    Real Estate Broker
    (530) 263-1091
    E-mail jodell@nevadacounty.com

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    Real Estate

    New rules for Refinancing That You Just do not Hear About

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    refinancing

    Let me try to help you make sense of the Government Home Affordable Refinance program. Believe me it can be very confusing.

    Under the federal government’s Home Affordable Refinance program the plan is confusing and confounding. For example, under the program, lenders are supposed to refinance loans with mortgage insurance. But they are evasive about whether they will.

    Another example: Last month, Fannie Mae and Freddie Mac announced that they would refinance mortgages at up to 125 percent of current market value. Sounds great — but borrowers will have to wait.
    Continue reading New rules for Refinancing That You Just do not Hear About →