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Homes Under WaterHUD Announces Expansion of Making Home Affordable
(7/6/09)

In what may be good news for many struggling mortgage holders, Shaun Donovan, Secretary of the U.S. Department of Housing and Urban Development, announced on July 2nd that homeowners who are up to 125% “underwater” are now eligible for refinance of their mortgages. Borrowers whose mortgages are either owned or guaranteed by Fannie Mae and Freddie Mac, and who meet the other requirements, may now qualify to refinance those loans under the new terms of the Home Affordable Refinance program.

With hopes of reaching millions of homeowners, the changes will make it easier for borrowers to negotiate a lower payment. The new qualification limit will be especially helpful to owners in those areas where homes have experienced the most dramatic declines in value. The program’s expansion will now reach tens of thousands of additional homeowners who failed to qualify under the older limits.

HUD will also deploy what they are calling, Foreclosure Rapid Response Teams to those areas suffering the greatest numbers of foreclosures for the purposes of analyzing local conditions, education, and investigating complaints of discrimination. This new initiative is yet another indication of the seriousness of the foreclosure crisis and the government’s concern for its impact upon the overall economy.

While the new changes may be able to help thousands of additional borrowers, homeowners must still meet the income and debt requirements, and must be current with their mortgage payments. Borrowers should check with their lender to see if they are eligible for relief under this expanded initiative.

 

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