September 8th, 2009 by refinancemortgagerates
In the times of recession when most of the home owners are struggling with paying the monthly payment, Obamaâs Stimulus Plan comes as a great relief. This does not mean that even the deliberate defaulters are going to be benefited. The plan is structured in such a way as to benefit those people who have genuinely tried to repay the loans but because of the financial turmoil have not been successful. Obamaâs Stimulus Plan is not an alternative to home mortgage refinance. It is a sort of loan modification. This plan is most probably going to benefit at least 9 million home owners.
Some of the characteristics of Obamaâs Stimulus Plan are as follows:
- The rates of interest on the mortgage also known as refinance mortgage rates become fixed rather than be adjustable or variable
- Decrease in the principal amount of the loan.
- Decrease in the refinance mortgage rates is applicable on the loan.
- Relinquish of extra charges and late fee
- Extension of the duration of paying off the loan so that the monthly payment is reduced
- The applicable refinance mortgage rates in Obamaâs Stimulus Plan sometimes go as low as 2%.
See If You Qualify…….!
According to this plan the debtor will not be paying monthly payments exceeding 31% of the gross income.
Thus the lender is approached to loan modification the present scheme, in such a way that the monthly payment is within the before said limitations (31% of the gross income). The goal could be achieved by increasing the period of the loan with a simultaneous decrease in the rate of interest applicable on the loan. In such circumstance the refinance mortgage rates could go as low as 2%. Before the offer of Obamaâs Stimulus Plan the alternative with the lender was the foreclosure of the property but the lender could not recover the pending loan. Now the lender has more houses that cannot be sold but from where debt recovery is possible.
This plan is not offered to debtors who are regularly paying their monthly payments. If the debtor wants to avail this plan, inability to pay future monthly installments has to be proved. One of the conditions to avail this plan is that the mortgage amount should not exceed 105% of the house value. If the mortgage is guaranteed by or through Fannie Mae or Freddie Mac, this plan is applicable. Those debtors who have been regularly paying the monthly mortgage for the past 12 months can take the advantage of this plan. If the monthly payment history within the past 12 months is tinted with irregularities then the debtor may not be able to take advantage of this plan. Thus this plan cannot be compared to bad credit mortgage refinance.
Only the fress loan would be eligible for mortgage refinance at fixed rate of 2-3%. The second mortgage are exempted.
No other loan except mortgages guaranteed by Freddie Mac and Fannie Mae would be considered for Obamaâs suitability plan.
Through this Stimulus plan one can get excess of money to pay other bills like education and money. Thus it can work as cash out refinance. Home mortgage refinance at the refinance mortgage rates of 2-3% would be applicable for properties that are being used for residence.
If the monthly installment is exceeding 31% of the borrowerâs total gross income then only this plan can be applicable to modify mortgage or refinance home loan.
If you need the refinance loan without document get the information to get no doc refinance.
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This entry was posted on Tuesday, September 8th, 2009 at 10:03 pm and is filed under Mortgages. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.