Jeremy's Blog

What's all the buz with this Obama Refi?

Benefits

• Up to 105% LTV
• Appraisal may not be required
• NO PMI possible
• Min. 580 Credit score
• Loan must be held by Fannie Mae & Freddie Mac
• Must income qualify

Pitfalls

• No Interest only or stated income loans
• Program doesn't roll out for another 2 months
• Rates will be market rates (possible rate hits for high LTV's & low credit scores)
• So sad to bad if your upside down by more than 5%
• Investors may put additional restirictions in place
• Fannie & Freddie loans only
• No cash out. That's right Obama will not let you get cash out. The problem with that is that if you took out a second mortgage after you bought the home it can not be wrapped up into the loan. It needs to be paid off or subordinated (good luck getting a lender to subordinate this day in age).

There are many restrictions and loopholes. Call me today to discuss.

Modification Options: Designed for homeowners struggling to make their payments because of an interest rate increase or change in income.

• First-lien loans on owner-occupied properties with unpaid principal balance up to $729,750.
• All borrowers must fully document income
• Incentives to lenders and servicer's to modify at risk borrowers who have not yet missed payments when the servicer determines that the borrower is at imminent risk of default.
• Modifications can start from now until December 31, 2012; loans can be modified only once under the program.
• The program will share with the lender/investor the cost of reductions in monthly payments from 38% DTI to 31% DTI.
• Servicers that modify loans according to the guidelines will receive an upfront fee of $1,000 for each modification, plus "pay for success" fees on still-performing loans of $1,000 per year.
• Homeowners who make their payments on time are eligible for up to $1,000 of principal reduction payments each year for up to five years.

The modifications guidelines are simply an outline. It is up to each servicer of the loan to decide if & how they will modify a loan. Have your customers call me today for some tips and pointers before they call the loan servicer. I will help give your customers an edge before calling.

BEWARE OF MODIFICATION SCAMES

HELP IS FREE!

CALL ME TODAY FOR A FREE CONSULTATION!

(269) 598-3975