Do You Qualify for the hottest mortgage loan, HARP?
FHA refinance loans aren’t always attainable for self-employed borrowers looking for fixed rate refinancing, because HUD requires full income documentation. Loan modification plans can be nearly impossible for borrowers in high cost regions like California, New York and Florida who have jumbo mortgage loans. Mortgage relief is often easier said than done.
When the stimulus package passed, millions of homeowners felt they were dissed. While the new mortgage relief program focuses on homeowners in foreclosure, it offers nothing for the homeowner who is responsible and current with their home loan payment. To compensate for this oversight, the U.S. Department of Treasury recently launched the Home Affordable Refinance Program (HARP). “HARP was created specifically to provide access to reduced-cost home refinancing for responsible homeowners with no equity in their home. Millions of Americans have lost their home equity due to the decline in home prices,” said Joe Engle, president of Loan Smart, Inc. in Thousand Oaks, California.
Presently, millions of homeowners find themselves in the unsettling predicament of having to sit on high mortgage interest rates that are not affordable or about to rest to a higher payment that will tip the budget negatively. Most good borrowers are unable to refinance their homes and take advantage of historically low interest rates, because of the declining home values.
Through the Home Affordable Refinance Program 4 to 5 million responsible homeowners will have the opportunity to refinance their homes, even if they owe more than 80% of their property’s value. “With low fixed rate mortgage refinancing, many families could see a reduction in their mortgage payments by thousands of dollars per year,” said Engle. Unfortunately, not everyone qualifies for Home Affordable Refinance Programs. This refinance program only benefits homeowners with home mortgages owned or guaranteed by Freddie Mac and Fannie Mae, which are Government Sponsored Enterprises. “At Loan Smart, we can assist homeowners with determining if they qualify for HARP by researching to find out if their loan is owned by either Freddie Mac or Fannie Mae,” commented Engle. Engle points out that HARP will offer a huge advantage to homeowners with first and second mortgages. HARP will allow for refinancing of the first mortgage up to 105% of the current home value, with the second mortgage remaining in place.
Low mortgage interest rates continued this week amid mixed reports about the slowing economy, Freddie Mac’s chief economist said on Thursday. According to Freddie Mac chief economist Frank Nothaft, “Both the core producer price and consumer price indexes ticked up in January, higher than the market consensus, while consumer confidence in February dropped to the lowest reading since records began in January 1967,” said, in a news release. FHA mortgage rates remain low with 5.625% average on thirty year fixed rate home loans.
o Low Rate FHA Home Loans
o Mortgage Refinancing Tips
o Renegotiating Lower Mortgage Rates
o Home Equity lines of Credit
Thirty-year fixed-rate mortgages averaged 5.07% for the week ending February 26, up from last week’s 5.04% average but still lower than their 6.24% average a year ago, according to Freddie Mac’s weekly survey of conventional rates. Meanwhile, fifteen-year fixed-rate home loans averaged 4.68%, unchanged from last week and down from 5.72% a year ago.
5-year Treasury-indexed hybrid adjustable-rate mortgages averaged 5.06% this week, up from 5.04% last week; the ARMs averaged 5.43% a year ago. 1-year Treasury-indexed ARMs averaged 4.81% this week, up slightly from 4.80% last week; the ARMs averaged 5.11% a year ago. To obtain current mortgage rates, the fixed interest mortgage loans and the 5-year ARM required payment of an average 0.7 point, while the 1-year ARM required an average 0.6 point. A point is 1% of the mortgage amount, charged as prepaid interest.
In the news release Nothaft said “Reductions in home prices and affordable mortgage rates have yet to spur housing demand.” You can see how new sale prices continued to decline home. “For instance, house prices declined by 8.7% for the twelve months ending in December 2008 and were down 10.9% from their highs set in April of 2007, according to the Federal Housing Finance Agency’s purchase-only monthly home price index.
According to Primary Mortgage Market survey released by Freddie Mac, 30-year mortgage loans with fixed rate amortizations schedules dropped to their lowest level on record, Thursday. FHA mortgage rates declined again, along with conforming interest rates to nearly 5% for fixed 30-year loan terms.
The nationwide average interest rate for 30-year mortgage loans featuring fixed rate on a thirty year term was 5.19% for the week ending December 18, the lowest level since Freddie Mac began the survey in 1971. First mortgage rates were down from last week when it averaged 5.47 %. A year ago, the average for mortgage loans was 6.14%. Second mortgage rates still remain a few points higher than interest rates for 1st trust deeds. Amid the foreclosure crisis, second mortgages remain a high risk for mortgage lenders and investors.
The fifteen-year fixed-rate mortgage averaged 4.92 %, down from 5.2 % last week and 5.79 % a year ago. The fifteen-year mortgage rates have not been lower since April 1, 2004, when they averaged 4.84 %. According to a statement by Freddie Mac chief economist, Frank Nothaft “The rate drop was driven by the Federal Reserve announcement on December 16th, when it cut the federal funds target to a record low and stated it stood ready to expand the buying of mortgage loan assets as conditions warrant.”
Five-year Treasury-indexed hybrid adjustable-rate home loans averaged 5.60% this week, which is lower than the previous week that averaged 5.82%. A year ago, the five-year ARM averaged 5.90%. One-year Treasury-indexed ARMs averaged 4.94% this week, down from last week when it averaged 5.09%. At this time last year, the one-year ARM averaged 5.51%.
