If you are upside down on your mortgage and don’t know how to handle the situation, then the Home Affordable Refinance can help your cause. This is a new program introduced by the Obama Government to assist millions of homeowners who can’t refinance their property due to loss of equity.
Home Affordable Refinance Program in brief:
It is a program which lets you to refinance your existing mortgage into a fixed rate loan for 30 years or 15 years even though you owe more on your mortgage than your home is worth. While you refinance the mortgage, you can take advantage of the current rates prevailing in the market.
Eligibility for Home Affordable Refinance:
- You must be current on their mortgage payments. Also, your mortgage should have been originated before January 1, 2009.
- The 1st mortgage on your home should not exceed 105% of the present market value of the property.
- Your loan should be backed by Fannie Mae or Freddie Mac. Homeowners with jumbo loans do not qualify for this program.
- You can take advantage of this program only for your primary residence.
- You should have sufficient income to pay off the loan according to the new plan given by the lender.
Fees associated with Home Affordable Refinance:
Like any traditional refinance, you will have to pay lender fees, points and other closing costs.
Documentation required:
- A copy of the recent tax return.
- Two recent pay stubs. If you are self-employed, then income will be verified by checking your bank deposits, freelance paychecks, etc.
- Information about second mortgage, if any.
- Credit card account balances and monthly payments due.
- Information on car loans, student loans, etc.