Obama Administration's is trying to make Homes affordable for desperate homeowners

New mortgage guidelines to help struggling Homeowners...

Fannie Mae and Freddie Mac are extending the suspension of all eviction proceedings through March 31, 2009 as Fannie Mae implements the Home Affordable Refinance and Home Affordable Modification initiatives. Both programs are available to its servicers and borrowers as part of the Obama Administration's Making Home Affordable program.

-Most borrowers refinancing an existing Fannie Mae loan will not be required to buy new or additional mortgage insurance if the loan at the time of the refinance is more than 80% of a home's value.

-Fannie Mae can refinance loans up to 105% of a home's value with this new flexibility, so even borrowers who are "underwater" may be able to refinance.

-Beginning in April, all 1,600 lenders and 29,000 mortgage brokers using Fannie Mae's Desktop Underwriter platform will be able to process an application to refinance any existing Fannie Mae loan, allowing for greater origination capacity and easier refinancing for borrowers.

Through the Home Affordable Modification, loan servicers participating in the program may reduce interest rates, lengthen the payment time frame or take other steps, such as principal forbearance, to bring the monthly payments down to as low as 31% of the borrower's gross income. Fannie Mae has also issued special foreclosure sale requirements. A foreclosure sale may not occur on any Fannie Mae loan until the loan servicer verifies that the borrower is ineligible for a Home Affordable Modification and all other foreclosure prevention alternatives have been exhausted.

Kevin Caylor

Pacific First Mortgage
San Diego

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