by California FHA Mortgage Loan Expert on July 1, 2009
California Obama Refinance To 125% Announced
Today, it was announced by HUD Secretary Shaun Donovan that people who owed more than 105% of what their home was worth could now refinance up to 125% of the home’s value. This is great news to many homeowners in California because now they can refinance up to 125% of the homes value where the prior limit under the Obama Refinance Plan was 105%. This expansion to the Making Home Affordable plan will help many people right here in California and is another sign that the Obama administration is doing whatever they can to contain the foreclosure problem.
Right here in California, this change is expected to help thousands of people who currently owe more than 105% of their home’s value to refinance to lower rates. Before rates go up again, it is expected that many people here in California will rush to get their refinance applications in.
According to CNN:
More than one in five borrowers are now underwater, with homes in parts of California and Florida losing more than 50% of their value, according to Zillow.com, a real estate Web site. Some 20 million people own homes worth less than their mortgages.
News reports in Bloomberg said:
A drop in values has left about 20.4 million of the U.S.’s 93 million houses, condos and co-ops with mortgages higher than the properties are worth as of March 31, Seattle-based real estate data service Zillow.com said in a report May 6.
For California Homeowners: What This Means
While it is difficult to tell exactly how many people in California will benefit from this change, there are surely many people right here in California who will now be able to refinance - and hopefully avoid foreclosure. For the most up to date information on the new Obama refinance expansion announcement, be sure to contact a California mortgage expert today!
by California FHA Mortgage Loan Expert on June 23, 2009
Many people in California currently owe more than their home is worth – sometimes hundreds of thousands of dollars more. Most of these people have been looking for a solution that will help them get their loan amount down to at least what the house is worth – and they the only option they are aware of is Loan Modification.
Sound familiar?
What many people don’t know is that there is actually a way better solution to this problem than loan modification – it is called an FHA short refinance. An FHA short refinance works much like a short sale – except that you get to keep the house rather than sell it to someone else.
If you think that the FHA short refinance program might be right for you, the first step is to get on the phone with your lender and tell them that you are interested in SHORT SELLING your home. Once they hear that, they will usually transfer you to the loss mitigation department – which is the right one.
Once you get to the loss mitigation department, you want to negotiate for something called a SHORT PAYOFF – which means that the lender will agree to accept less than you currently owe. If they say they won’t allow short payoffs, then ask them what they are doing when they accept a SHORT SALE.
No matter what – don’t take NO for an answer! Many times (most of the time) the lender will give you a different answer depending on who you talk to. If you don’t get the answer you want – just try back the next day and speak with someone else.
Once you get the SHORT PAYOFF, then you should be able to get any FHA loan officer to help you get a new FHA loan for that amount – and easier than you can say the words “loan modification”, you will have a new fixed rate FHA loan that is 95% of what your home is now worth.
Don’t give up! A FHA short refinance can be a much better long term solution than a loan modification.
by California FHA Mortgage Loan Expert on June 17, 2009
Many people living in California who currently have FHA loans realize that interest rates are low - sometimes much lower than the current mortgage rate they have on their loan. The California FHA streamline refinance is a popular option for people who currently have an FHA loan and want to take advantage of lower interest rates without having to completely re-qualify for a new loan by proving income, asset and credit score information.
But wait - Is that all there is to the California FHA streamline program? Not anymore. many lenders are making it harder for people to participate in the FHA streamline refinance program because they are now requiring a minimum credit score of 620. Many lenders are requiring this, but not all lenders are requiring that you have a minimum credit score.
The truth is, FHA doesn’t have a minimum credit score requirement — it is the lenders who actually are lending you the money that do. About a year ago, lenders started requiring a minimum of a 580 credit score and as early as January of this year, some lenders started requiring a 620 credit score. Now a 620 minimum credit score has become the norm for lenders to require.
Do all FHA lenders require that you have a minimum credit score in order to get approved for a California FHA streamline? No, but many of them are. You can still get approved for a FHA streamline refinance no matter how bad your credit score is as long as you have made your payments on time for the last 12 months.
