Obama To Refinance Your Home Loan To A Lower Payment?

Is Obama Going To Refinance Your Spokane, WA Home Loan Into A Lower Payment?

If you’ve not been able to refinance your loan to a better interest rate, or you’ve just been waiting for the right time, you need to pay attention in the coming days.  Home owners in Washington and California are likely to see an unprecedented opportunity to refinance their home loans.

There’s a growing buzz that President Obama is going to announce a new mortgage relief refinance program during his speech scheduled for next Thursday evening, September 8.

Why the big focus on helping you refinance into a lower interest rate mortgage?  It’s about the only immediate way to put cash in your hands that you will hopefully spend, thus stimulating the economy. 

If you can save $200 a month on your mortgage payment that’s the equivalent to a 6% pay raise if you’re earning $40,000 a year.  We’ve recently helped a family in California reduce their mortgage payment by $340, and they had just refinanced a little over a year ago!

Regardless the President’s new initiative, we already have a great mortgage relief refinance program in place.  The Making Homes Affordable refinance program (HARP) already allows eligible Spokane area home owners to refinance their existing mortgage balance up to 125% of the home’s value.

 I’m not sure the current program can be expanded enough that it makes a significant difference.  A quick Google search turned up numerous articles on Obama’s refinance program and I’ve lifted some choice sections from a Reuters.comarticle.

“The refinancing initiative would allow certain borrowers to refinance loans that are backed by government-owned Fannie Mae and Freddie Mac or the Federal Housing Administration.”  I’m not sure why that’s news – this can already be done.  The Home Affordable Refinance Program covers conventional loans and FHA has its own Streamline Refinance program.

“…allowing borrowers to refinance even if they owe a significant amount above their property’s current value.”  We can do that too.  However, if the current limit of 125% of the home’s value was lifted and  was made unlimited you’d probably get a rush of refinance applications from home owners in CA, NV, AZ, and FL.

Considering how important states like CA and FL (in particular) are to the economic health of the entire county, lowering the mortgage payments for home owners in those states could have a decent impact.

“While the administration is under pressure to firm up the details, it is not yet clear whether borrowers seeking to take out a loan that is more than 80 percent of the value of the home would qualify for refinancing.”  I wish reporters would consult industry professionals before they rushed to print!

You already CAN refinance a loan that is more than 80% of the home’s value.  The current Homes Affordable Refinance Program already allows eligible borrowers to finance up to 125% of the home’s current value.

To be notified immediately of the opportunity to lower your mortgage interest rate, send me an email at mmullin@theloanconsultant.com and we’ll make sure to add you to the notification list.

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