The federal government is exploring more solutions for
underwater borrowers by discussing a proposed refinance program
that would help homeowners with non-government backed loans.
The proposed initiative, titled Rebuild American Homeownership
(RAH), would function similarly to the government's current Home Affordable Refinance
Program (HARP 2.0), which is designed to help borrowers who had
financed their mortgages through Fannie Mae or Freddie Mac, two
RAH would make mortgage refinance
available to a wider array of borrowers by removing limitations on
a homeowners loan-to-value ratio. The guidelines of the proposal
state that as long as borrowers are up to date on their mortgages,
they would qualify for better rates on a restructured loan.
The program stipulates that it would not need to be funded by
taxpayer money and would in fact be profitable for banks while
still helping out borrowers. Funding would come from a bond-buying
initiative backed by the federally secured Refinance Trust.
Average interest on a fixed-rate loan has tumbled to all time
lows of late, breaking records consistently over the past three
Mortgage refinance has spiked in response to the record lows,
accounting for 81 percent of all mortgage business in the last week
according to figures released by the Mortgage Bankers Association
(MBA), which tracks lending trends nationwide.
Senator Jeff Merkley of Oregon officially endorsed the program
in a press statement released on July 25, claiming the program
would help solve the housing crisis, which took the country by
storm at the end of the previous decade.
To figure out what refinance options are available to you,
contact an expert at New Penn Financial to get up to date on what
programs and rates you may qualify for.
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