Those people who are fortunate enough to have been given a loan from either Freddie Mac or Fannie Mae are now able to refinance or modify their loans. This is because of the new guidelines implemented by President Obama’s new plan “Making Home Affordable.”

Some are not exactly sure how one would qualify to refinance their loans or for a loan modification. Some requirements for eligibility in Obama’s new plan:

- Those homeowners who are not eligible to modify or refinance their loans using President Obama’s stimulus plan are those who have declared bankruptcy.

- A home with more than a single family in a residence is also not eligible for the Obama stimulus plan

- Homeowners who have seen their homes drop in value should not feel discouraged. Those who have seen the value drop by as much as 5% are eligible for the plan.

- If your monthly mortgage payments are higher than your homes actual value you are eligible for the stimulus plan.

- Those people who are automatically eligible to refinance or modify their loans according to Obama’s plan are any homeowners who have their home loans financed, insured or backed by Freddie Mac or Fannie Mae.

Now more than before loan refinance and modification are favoring the borrower. A limit for a mortgage payment has been placed into affect by the Federal Government. Due to the current state of the housing market, a home loan can now be no more than 31% of the buyers’ monthly income. Also a buyer’s total debt including home loan, credit cards, living expenses, etc must not exceed 55% of the homeowners’ income. HUD, Housing and development department sponsored by the government, will offer homeowners free mortgage counseling if they wanted to use this option. The agents provided by HUD will be your representative and work to get you a fair deal on your mortgage rates. Get a great deal on your mortgage just do a little research and make sure you get the best possible deal out there.

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