President Barack Obama and his administration recently unveiled their “Home Affordability Plan” which is a mortgage stimulus program that will allow homeowners a chance to refinance their current mortgage into a new one with a 4.5% fixed interest rate. Obama estimates that 9 million homeowners can take advantage of this plan and see big savings.

This government backed plan will give cash incentives to mortgage lenders and banks who approve home refinancing for “At Risk” homeowners. This includes homeowners who have lost their job, have seen their income reduced, are facing large medical bills or facing other debts and are or could be at risk of losing their home. What this means for homeowners is that refinancing a mortgage now is easier and the savings are bigger than ever before. With the cash incentives from the government, mortgage lenders and banks are easing the restrictions and requirements usually required for refinancing a mortgage. An example is the amount of equity in your home needed to refinance. Typically, a refinance requires that the homeowner has at least 20% equity in the home. Now though, lenders and banks are waiving those requirements in order to allow more refinance approvals and get that government stimulus money.

There are however some requirements nesscary to refinance using this “Home Affordability Plan” from Obama, here is some of them:

-The home in question must be lived in as a primary residence and can not be an investment property.

-Homeowners whose home values have dropped by 15% or more will be able to refinance into a new home loan at a 4.5% fixed rate. This will help people who bought a home when the housing market was hot but has recently nosedived, leaving home values dropping all over the country.

-Homeowners who have a home mortgage that is backed by mortgage lenders Fannie Mae or Freddie Mac will automatically qualify for a home modification is there are facing any type of financial hardship as mentioned earlier.

-Homeowners who are most at risk and facing immediate foreclosure can streamline the refinancing process using this Obama mortgage plan and have a greater chance of saving their home.

Millions of homeowners will qualify for this mortgage stimulus refinance plan and can almost instantly see a huge savings in their monthly mortgage payment. This plan will also help the overall housing industry as less foreclosures occur and home prices stabilize and rise to their pre mortgage crisis levels. Refinancing the right way will save you thousands of dollars over the course of the loan, it can also be a great choice to save your house. Refinance now and take advantage of this Obama “Home Affordability Plan” while there is still time.

-M Petrone

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