Homeowner Affordability and Stability Plan

On Wednesday, the president disclosed the Homeowner Affordability and Stability Plan offering assistance to millions of homeowners in an attempt to stop the flood of foreclosures.

The plan has three main sections and only applies to primary residences, investors will not benefit from this plan.  The loans affected are all government loans, under Freddie & Fannie conforming loan limits, no jumbo loans.

1.      Refinancing will be allowed for homeowners whose home values dropped and now have little or no equity.  Refinance guidelines had required the homeowner to have at least 20 percent equity this will no longer be a requirement.

2.      The Homeowner Stability Imitative will assist homeowners who are “underwater” on their mortgages.  An important aspect is that homeowners do not have to be delinquent to participate.  Lenders will be given an incentive to participate.  Lenders and the government will come together to reduce the primary mortgage monthly payments. They will use a 38 percent debt-to-income ratio and then they would split costs further reducing the monthly payments until there at a 31 percent ratio. An integral part of this section will create clear and concise guidelines for loan modifications that may be put into practice across the entire mortgage market.

3.      This section of the plan involves support for low mortgage rates by the Treasury Department strengthening Fannie Mae and Freddie Mac increasing mortgage-back securities and portfolios.

The final pieces of this plan are still being developed such as the modification guidelines which will be released March 4.

If you feel that you will qualify for help with this new Housing Affordability and Stability Plan, I strongly urge you to contact your lender.  Call the phone number on your mortgage monthly invoice, be patient and ready to be on ‘hold’, remember they don’t have the guidelines but should be able to give you some basic information regarding your loan.

 

“If this is your kind of town…let me show you the neighborhood.”®   Live the ‘slo life’ in San Luis Obispo County.  Shirley Hulin is a full-time REALTOR® and manager for Century 21 Hometown Realty she works with a team of professionals who are ready to help you with all of your Real Estate needs in San Luis Obispo and Northern Santa Barbara Counties.  Contact Shirley at ShirleyHulin@gmail.com www.ShirleyHulin.com    

 Rentals or Property Management: Rent@c21Home.com    

To receive information on Short Sales, REO’s or Foreclosures: Foreclosures@c21Home.com

 

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