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2 Refinancing Options if You’re Underwater

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Published: Tuesday, August 17, 2010

2 Refinancing Options if You're Underwater

If you are facing a mortgage balance that exceeds your current property value, there are a few options that the government has established that gives homeowners a chance to refinance.

The first option is through the HARP or Home Affordable Refinance Program. This program focuses on borrowers whose loans have risen over 100% of their home's value. In order to qualify for this refinancing option you must a clean payment history. This means you cannot have any delinquent payments within the last 12 months.

The second option is through the HAMP or Home Affordable Modification Program. This program follows directly behind the HARP because it allows homeowners who do have missed payments to modify the terms of their mortgages. In order to qualify for this program you must demonstrate you are in a financial hardship and your loan must be owned by Fannie Mae or Freddie Mac. This modification has a trial period of 90 days, which allows the lender to reassess the situation and determine if a long-term modification is necessary.

These 2 options can be what you need to keep you out of the water. If you are not able to qualify for these do not bury your head in the sand and do not wait for a foreclosure notice. Ask about short sale possibilities and get out while you can!

If you have any questions or concerns please feel to call!

I am here to help you!

Bella Esshaki