President Obamas “Making Home Affordable” plan will help an estimated 9 million homeowners get a more affordable monthly mortgage payment. This is done through $75 billion in funding which will be given to mortgage lenders and banks to minimize any potential loss they may have from approving “at risk” and “financially struggling” homeowners for refinancing or mortgage modification. Here is how it works:

-Homeowners can get refinancing or home loan modification in order to get a reduced monthly payment, extended loan terms, or lowered interest.

-The guidelines of this plan call for a homeowner to not have to pay more than 31% of their income towards their monthly home loan. While this may seem like a lot, to many homeowners it is a big reduction. Currently, a lot of the “struggling” homeowners are in a bad mortgage, or pay 50% or more of their income towards their mortgage.

-Homeowners with a mortgage from Fannie Mae or Freddie Mac are automatically eligible for a home loan modification. This mortgage modification will only help homeowners who pay more than 31% of their gross monthly income towards their home.

-Homes which have dropped in value can still get approval for refinancing or modification. This plan allows homeowners with property that has dropped in value as a result of the bad housing market and tough economy. Before this plan, a home which dropped in value had little chance of getting approved for refinancing or mortgage modification.

-Homeowners in a bad mortgage, and who owe up to 5% more than the homes market value, can get refinancing. These homeowners had no chance at approval prior to this Obama housing stimulus.

Mortgage refinancing or modification are great options for millions of struggling homeowners. This new mortgage stimulus plan will help many people keep their homes, and not lose them to foreclosure or mortgage default. If your a homeowner you need to take advantage of this plan now, before it is too late.

-M Petrone
www.RefinancingCondo.com

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