How Much Will Federal Mortgage Assistance Programs Save me?
Posted on | April 13, 2009 | 3 Comments
The Making Home Affordable Federal Mortgage Assistance Program is expected to help up to 9 million home owners. The program will assist with refinancing and loan modifications. President Obama is also pushing for mortgage rates to steadily decline. This will greatly help those that do refinance or get a modification by making their mortgage payments much lower. How much lower would mortgage payments be?
Obviously the only way to answer this question is to determine what mortgage rate you can get and how many years are left on your loan. Do not be fooled into thinking that you can lock in under 5% just because this program was created. To get a rate below 5% you must have at least 70% loan-to-value in your home and a GREAT credit score. If this is not the case, you can forget about getting that low rate refinance. You may very well be able to refinance, but it won’t be at the historically low rates you are seeing advertised.
If you are struggling to make your mortgage payments, the Making Home Affordable Plan will greatly assist you by reducing your mortgage payment to 31% of your monthly income. If your mortgage is backed by Fannie Mae or Freddie Mac, you will see your mortgage payment reduced to 31% of your monthly income.
Ultimately, President Obama hopes that this will kick start the housing market. I personally do not think it will work as people are still losing their jobs. What is the difference in a mortgage payment of $1200 and $800 if you do not have a steady income? We will see what happens, but this economy will continue to struggle until private industry jobs are created.
Tags: assistance programs > federal mortgage > mortgage assistance program > mortgage rates
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