Mortgage Relief Coming Soon!
....final details will be released Wednesday, but Donovan said the plan will allow borrowers with big debts from car loans, credit cards and unaffordable mortgages to have their home loans modified to lower the monthly payment, even if they are not in default.Borrowers who owe up to 5 percent more than their home’s current value will be able to refinance, as long as their mortgages are held by mortgage finance companies Fannie Mae or Freddie Mac. At the same time, loan modifications will be available for borrowers who owe up to 50 percent more than their home’s current value, Donovan said.A refinanced mortgage involves a new loan contract, while a modified mortgage involves changes to an existing one, such as extending the amount of time it takes to pay the loan back from 30 to 40 years, or lowering the interest rate.Testifying before Senate lawmakers, Donovan said, “We expect to see large numbers of modifications happen very quickly,” and hope it causes foreclosure rates to drop as soon as April.
source: NAR
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