Loan Modifications ... Refinance
Present Options That Can Exist
It seems lately, that I've had more and more questions from homeowners about "Loan Modification", as they continue to struggle within today's challenging market and economy.
Agents and many of my other referral partners also want to know about them, and other financing options that might exist, too. THEY are getting quizzed by homeowners (and potential buyers) regarding Loan Modifications too ... especially now after the governments release of information regarding the upcoming HARP 2.0. It seems, you can't be doing business within the current market and not get drawn into these conversations.
The reasons for "why" someone might need or want to modify their existing mortgage range from unemployment issues, to being "upside-down" and/or "underwater" with their current home loan. Simply being in need of some financial relief ranks up there in concerns I often hear too.
Naturally, when I get questioned as a mortgage lender, I first look to see if a "traditional" Refinance is possible for the homeowner. And if so, will it provide the much-needed relief that homeowner needs and desires? Most often as of late, I'm finding that the traditional Refinancing route is not one that can taken. Today's tighter mortgage underwriting standards simply make it more difficult and in a few cases, impossible for the time being.
Where does that leave the homeowner in need when that is the case? That means a loan modification of the existing mortgage with the homeowner's CURRENT loan servicer, is the remaining option.
If the homeowner has NOT missed any payments on their mortgage, the unfortunate and disheartening news is ... they will have a very difficult, if not impossible, time in attaining any loan modification. I know ... VERY frustrating, right?
If the homeowner is current with their mortgage payments, I now have a fighting chance with HARP 2.0 to assist them in their search for financial relief. That assistance relies upon the homeowner's credit and income qualifications, as usual. And if current property value is no longer a hurdle, HARP 2.0 should open-up some real opportunities to them. But there are two issues that surround the possible benefits that may be seen within HARP 2.0, as they stand right now.
First, we mortgage lenders still do not have the specifics we need from the government in order to take action on our clients' behalf regarding HARP 2.0. Again, frustrating ... as the government has done a fairly good job in making the public aware as to the existence and updating of the HARP program. The public is aware and contacting us mortgage lenders hoping for good news ... and of this writing ... we still do not have the details as to how we can move forward, apply, and utilize HARP 2.0.
We've heard rumblings. We've seen projections. We've read "guesses" ... but still nothing tangible to hang our hats on, as of yet. My personal belief is that we will need to hang on to our hats a while longer too, because we will not receive these much-needed program specifics until after the New Year, some say March, 2012.
To me, the second issue surrounding HARP 2.0 is this ... WHY should this concern Realtors or the local real estate markets?
In my opinion, helping homeowners Refinance, who might have otherwise lost their homes to foreclosure, or put another short-sale property on the market, is critical to regaining a sustainable housing market.
Let's state the obvious: Foreclosures and short sales are options for the struggling homeowner. Neither is good; neither helps property values; neither helps reduce inventory. And again, in my opinion, reducing housing inventory is what we sorely need right now.
I see the bottom line being this: Until we reduce housing inventory and eliminate the short sales and foreclosures, we will be mired in static property values. Buyers will remain reluctant to enter the marketplace under these conditions.
In addition to keeping "bad" inventory from hitting the market, the lower payments after Refinancing will put more dollars in the homeowners' pockets, which will in turn trickle-down to more spending by consumers. Since we are definitely a consumer-driven economy, this is one way to help our country out of its' real estate malaise and help get us turned around and on the path to better financial health.
Homeowners (and referral partners) need to keep seeking-out educated, professional mortgage lenders that will provide sound and unbiased fact-based opinions ... especially when the homeowners seeking those opinions are emotionally and financially distraught or down-and-out.
Changes happen constantly and steadily in our industry. New options may become available for homeowners at any time. It is best to remain vigilant. Homeowners and mortgage lenders need to stay in contact, communicate, get it right.
New options, new programs, new underwriting demands, HARP 2.0 ... all remain in our future ... we HAVE to get it right, in an otherwise imperfect marketplace.
* Should you have mortgage, refinance, HARP 2.0 questions, credit concerns, or general lending and finance questions ... please contact me. I'll be happy to answer your questions and assist you moving forward.
I can be reached through any of the following convenient methods:
Direct: 815.277.4036 Cell/Text: 708.921.6331
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Mortgage Originator - NMLS #216987
IL Lic. #031.0006220 - WI License #216987
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