September 25, 2018

Mortgage Grace Period For Unemployed Homeowners

“Unemployed homeowners will soon get an extension that will enable them to miss their mortgage payments for up to one full year. The Obama administration will lengthen the grace period from the current time frame of 3 to 4 months, to a full year for those who need additional help to stay in their homes and for those who may be facing foreclosure. This extended grace period only applies to loans obtained from the Federal Housing Administration. This time extension is expected to help tens of thousands of people who are unemployed and are having a difficult time paying their current mortgage and need longer than a few months to get back on their feet.

Officials say that 10,000 unemployed homeowners took advantage of the 3 month grace period within the past year. The reason the FHA is extending the grace period is to try and boost the current foreclosure-prevention program and keep further forclosures from occuring. In 2010, approximately 17,000 troubled homeowners benefitted from the ability to delay their payment that was granted to them by the government. Urban Development Secretary Shaun Donovan hopes this move will compel Fannie Mae and Freddie Mac to follow suit and make the time allowance extension as well. The two government controlled mortgage companies currently back approximately 90 percent of newly obtained mortgages. Freddie Mac and Fannie Mae had no reply as to whether or not they will join the FHA in this endeavor, but come October 1, new rules will apply to the mortgage giants. Rules will be put into effect that will make allowances for long term help for disabled people and people who suffer from long term illness. If a homeowner dies and their property is put into probate, the mortgage payment on the property of the deceased can be delayed for up to one full year.

Trial modifications were allowed for over 1.6 million people who have experienced trouble paying their home mortgage to keep them from facing forclosure and losing their home, but the program has lost approximately 800,000 participants who have permanently dropped out of the governmental run assistance programs permanently. In 2009, the government’s main foreclosure program was created to ensure that at risk people at least had an opportunity to avoid home forclosure. The program’s extension will benefit many who have found themselves unemployed and will give them more time to find work. Hopefully, this will enable them to make their payments, avoid becoming homeless and adding to the already crippling home foreclosure rate.”

San Francisco Chronicle

Jobless homeowners could get mortgage reprieve

How To Get a Home Mortgage

A lot has changed in the home mortgage business in the last few years, changing the products available and the ease with which you might be approved for a home loan or home refinance loan.

Now that the mortgage landscape is forever altered, how do you get an affordable mortgage?

What is a mortgage?

Simply, a mortgage is a credit-based loan used specifically to buy or refinance a home. Mortgages are originated from lenders, specialized at handling these types of complex credit products. You pay for a home mortgage with monthly payments, similar to other types of credit payments you may make, such as student loans and credit cards. Most home loans don’t come due for many years, depending on how much of the cost you finance, the mortgage rate, and how much cash you can put down, if any.

Getting a Mortgage

If you’re a homebuyer, a reputable real estate agent will have mortgage professionals he or she works with regularly. They can review your financial situation before you begin making offers on homes, and might even get you pre-approved for a home loan so you know up front in what price range you should be shopping. Once you make an offer on a home, they will be ready to show you an estimate of the loan you might expect, including payments, and interest rate.

Refinancing Your Home

If you already own a home and want to refinance to lower your payments or get some cash for your home’s equity, you can contact your lender for refi options. They will give you a whole new home loan.

Remember, a mortgage is a credit-based loan, so mortgage lenders will need to do a credit check on you to finalize any loan documents, all of which are traditionally signed at the closing.

Managing Your Mortgage

Many lenders offer convenient online access to your account so you can manage various aspects of your home or refinance loan: current balance, payments made, interest rate, guidance if you have trouble paying your mortgage, and strategies for paying off your mortgage faster.

Subprime Meltdown Drives Mortgage Changes

In the months leading up to the recent subprime mortgage meltdown, even borrowers with little savings, high debt to income ratios, and poor credit were quickly approved for new home mortgages. Everyone was riding a wave of good fortune. But in hindsight, lending practices were sloppy. When the bottom fell out of the home mortgage market and prices adjusted to reflect reality, millions of new homeowners couldn’t make good on their home loans. Many of them should never have been approved for mortgages in the first place.

Do your homework. You will be better off in the homebuying or refinance market if you do a little research on the current options available for getting a home loan. Tip: typical options depending on your financial situation could include home loans for individuals with credit problems, no money down home loans, FHA loans, and Veterans loans. Find out how each could impact you short- and long-term and be prepared to ask your lender informed questions.

For more information, visit http://www.princeton.edu/economics/

How To Get A Home Mortgage

Purchasing a home is a huge commitment. The actual process that is required is often challenging and confusing and requires thorough research into the various options and lenders. It is important to select the right property if you need to acquire financing to fund the investment. It is important to be clear on the eligibility requirements before you submit an application for a mortgage.

Today, although there are now more lenders operating in this sector, the regulations and requirements that need to be met are far stricter than was the case prior to the economic meltdown that occurred a few years back. You will need to be adequately prepared if you are to find a suitable home loan that allows you to take possession of your dream property.

To ensure that there is no unnecessary delay in the process you will need to make certain that your documents are all in order. Depending upon the lender you apply to, you will need to provide a history of your income over a set period of time, expect that this would involve providing details of your financial statements during the past two years leading up to when you make the application.

The documents that are required may include your pay stubs, W2s, as well as material that show any retirement funds and social security payments you may have been given. It is also vital that your tax returns are complete and accurate. If you do not present the right information the chances of availing of a home loan can be dramatically reduced.

Your current assets and wealth will be examined in detail by the mortgage broker. Understand that the lender chosen will want to be certain that you have the financial wherewithal to cover any down payments, closing costs, and possible reserves. The latter is necessary as they are essential to show you still have adequate capital upon completion of the loan. In many cases the reserves must total the equivalent of three monthly loan payments.

There are other documents that may be requested depending upon the terms and conditions of the mortgage that you choose to apply for. If you have previously been made bankrupt or have undergone divorce proceedings, information relating to these can also be asked for. To prevent any unwanted delay in the process it is vital that you are as forthcoming and open with the broker as possible.

You may find it useful to check out information online relating to the current eligibility requirements that need to be met to be granted the type of home loan that you desire. Be aware that just because one lender turns down your application does not always mean that every broker will give you the same results.

At the end of the day, the strict terms and conditions that are now in place are there to ensure that you do not overstretch yourself financially. It would be unwise to take out a mortgage if you have doubts on whether you will be able to meet the monthly repayments on time.

For more information, visit http://www.nber.org/papers/w9284