You Owe More on Your Orange County, CA Home than It’s Worth & You Don’t Know What to Do – Option 3.5 – Obama’s Making Home Affordable – Refinance Program
This is a series for people who are “upside” down in their homes and looking to learn about their options. For the the first three posts see You Owe More on Your Orange County, CA Home than It’s Worth & You Don’t Know What to Do
In my last post, I discussed the loan modification program available under Obama’s Making Home Affordable program. Today, we’re going to delve into the refinance portion of this program. In today’s lending market, it can be difficult to refinance your Orange County, CA home if you owe more than 80% of the value of your home, and if you can refinance but owe more than 80%, you will likely pay mortgage insurance, which can drive up your monthly payment significantly.
Under the Making Home Affordable program requires the following to be eligible:
- Existing mortgage must be Fannie Mae or Freddie Mac.
- Maximum loan to value can be no more than 125% of the current value of the home. (ie. if you owe $125,000, the house must be worth at least $100,000).
- Mortgage must be current.
- No minimum FICO/credit score required. However, borrower must meet bankruptcy and foreclosure requirements.
- Refinance is rate and term only – there is no cash out on these loans.
- Mortgage insurance is required for loans that were originally more than 80% of the value of the house, only,
- Income and employment verification are required. There is no stated income under this program.
For people who have rates significantly higher than the current low interest rates but who can’t refinance under normal loans because the value of their home is more than the loan amount, this is a great way to reduce their monthly payments.
With the change from a ratio of 105% to 125% between the value of the home and the amount of the loan, this has become a more helpful to program for those with Orange County, CA homes. Prior to the change to 125%, many Orange County, CA homeowners didn’t qualify as median values of Orange County, CA homes have dropped approximately 40% in the last few years.
Though this will help some people with their Orange County, CA homes, it still will not help everyone. It won’t help the people who bought their homes with no money down, and who have lost more than 25% of the value of their home. It won’t help people already behind on their mortgage or who don’t have the income to qualify for the loans.
However, it is definitely an option to consider when you owe more on your Orange County, CA home than it’s worth, and you’re looking for options on what you can do.
Next time, we’ll discuss what is a short sale on Orange County, CA homes, and who qualifies for a short sale?
We know what your options are when you owe more on your home than it’s worth and don’t know what to do, and we will share it with you over the next few weeks.
If you want to make sure not to miss any of this series, please subscribe to this blog to learn your options.
If you have questions in the meantime, please contact Christine Donovan at 714-319-9751 or e-mail Me!
About the author: Christine Donovan is a California Residential Real Estate Broker with experience in assisting clients buy and sell residential real estate.
Are you upside down in your home? Do you owe more on your Orange County home than it’s worth, and you don’t know what to do? Are you concerned about making your mortgage payment? Contact me at firstname.lastname@example.org or 714-319-9751 to discuss your options.
Want to buy a home or to list your property for sale in Newport Beach, Costa Mesa, Huntington Beach or Orange County? Contact me at email@example.com or 714-319-9751 to learn about our system which will make your buying and selling experience easier.
Disclaimer: All information in this blog is deemed reliable but is subject to change at any time and is not guaranteed to be accurate nor are there any warantees either express or implied. This blog is not intended to offer any legal, tax or other advice.
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Copyright © 2009 by Christine Donovan, All Rights Reserved. You Owe More On Your Orange County, CA Home than It’s Worth, and You Don’t Know What to Do – Options 3.5 – Obama’s Making Home Affordable – Refinance Program.