Steps to take to refinance your mortgage
Called the Home Affordable Refinance Program, this plan would affect an estimated 4 million to 5 million homeowners having trouble securing refinancing.
You may qualify if . . .
1. The home is your primary residence.
2. You have a Fannie Mae- or Freddie Mac-backed loan.
3. You haven't been more than 30 days late on your mortgage payment in the last 12 months.
4. The amount you owe on your first mortgage is about the same - or less - than - the current value of the house. The amount owed cannot exceed 105 percent of the current market value.
5. You have a stable income to support the new mortgage payments.
Who doesn't qualify?
1. No investor-owned properties.
2. Homeowners who are already delinquent -- but they may be eligible for the Home Affordable Modification program.
What to do if you qualify
1. Gather information such as your recent pay stubs, income tax return, information about any second mortgage and account information on credit cards, student or car loans or other debts.
2. Call your mortgage servicer or lender to whom you make your mortgage payments and ask about the Home Affordable Refinance program. The details of the programs were just released, so expect it may take some time before they can begin accepting applications.
3. Called the Home Affordable Modification Program, this plan would affect 3 million to 4 million homeowners at risk of foreclosure.
You may qualify if . . .
1. The home is your primary residence.
2. You owe $729,750 or less on your first mortgage.
3. You got the mortgage before Jan. 1.
4. You're having trouble paying because of a significant hike in the payment, a reduction in your income or a financial hardship such as medical bills.
5. The mortgage payment is more than 31 percent of your gross monthly income.
6. Bankrupt homeowners may be considered, borrowers in litigation over a mortgage loan don't waive their rights and any foreclosure process will be suspended while borrowers are considered for this and other alternative foreclosure-prevention options.
Who doesn't qualify
1. No home mortgages larger than $729,750.
2. No investor-owned, vacant or condemned properties.
3. Loans can be modified under the program only once.
What to do if you qualify
1. Gather information such as your recent pay stubs, income tax return and assets. Also, you will need information about any second mortgage and account information on credit cards, student or car loans, or other debts. A letter describing why your income went down or expenses went up is also required.
2. Call your mortgage servicer or lender to whom you make your mortgage payments and ask about the Home Affordable Modification program. The details of the programs were just released, so expect it may take some time before they can begin accepting applications.
