Behind In Your Mortgage Payment? Ask Your Loan Officer About Fannie Mae's HomeSaver Advance

Need to get out of a hole?  This can do it for you, and it makes sense, both for you and for your mortgage servicer.  Fannie Mae will lend you up to $15,000 of its own money to bring you current and stave off the specter of foreclosure.  Unsecured.  At an interest rate of 5%. With mortgage lates on your credit!  This is a personal loan from FNMA to help you keep your home. 

Why does it make sense?  Won't FNMA lose some money doing this?  The answer lies in the real cost of foreclosure to Fannie Mae and your lender.  Compared to the average loss of $40,000 on a typical foreclosure, loaning you money at a low interest rate is a no-brainer.  The purpose of the personal, unsecured loan is to bring you current on your mortgage and let you keep your home.

You don't get the money.  It will go directly to your mortgage servicer.  Here's how FNMA describes the purpose of the loan:

"HomeSaver Advance is designed for qualified borrowers who have fallen behind on their mortgage, but are able to resume timely payments once their loan is brought current by the advance.  It helps [to] streamline the workout process for applicable loans, as it provides an option for earlier resolution of delinquent loans."

Here are the highlights of the program, which will begin next week (April)

  • Loan amount up to the lesser of $15,000 or 15% of the original unpaid principle balance for delinquent PITI, escrow advances (money to pay your taxes and insurance), up to 6 months of unpaid HOA fees, and advances for attorney's fees and costs.
  • Late charges and other ancillary fees and costs may NOT be paid by the loan.  (Want to bet that your mortgage servicer will waive those fees in order to bring you current?  Bet your bippie!)
  • Money goes to arrearages.  You never get cash in hand.
  • The note will be at a fixed rate of 5%.  The first six months are a no interest/no payment period!
  • Amortization period is 14.5 years after the initial six months.

  If you have kept in touch with the person who originated your mortgage, ask him or her to help you.  He or she will not be paid to do this, so it will separate the sheep from the goats, so to speak.  If you don't get help, it tells you something about your loan officer.  Find one who will help!

EDIT:  For your specific mortgage situation, you must call your mortgage servicer, not Fannie Mae.  I'll dig deeper and write another post in the next few days on the subject.

I'm Mike in Tucson, your preferred Tucson, Arizona mortgage lender.
Mike Jones (Tucson Mortgage Company, LLC): Loan Officer in Tucson, Pima County, Arizona
Think of me as your Local Expert.

 
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42 Comments on Behind In Your Mortgage Payment? Ask Your Loan Officer About Fannie Mae's HomeSaver Advance

Very useful post Mike! Thanks for sharing this here on AR! People need to be aware of the things that are available to help them out.

03/26/2008 11:30 PM by Susan Davis, Van Buren ~ Fort Smith ~ Real Estate (Exit Realty Fort Smith)


Susan,

Thanks for being the first to comment.  Spread the word.  This is available starting April 1, and I haven't seen another post about it yet.

Mike in Tucson

03/26/2008 11:34 PM by Mike Jones (Tucson Mortgage Company, LLC)


Mike, you are a lifesaver! I am going to forward this info to a few clients!

03/26/2008 11:35 PM by John Ford (Champion Real Estate)


John,

Pay it forward!  Spread the word.

Mike in Tucson

03/26/2008 11:36 PM by Mike Jones (Tucson Mortgage Company, LLC)


great post, I wonder if it works in all states?  Thanks Mike!

03/26/2008 11:38 PM by Larry Hultberg Newark Delaware Realtor (EXiT Central Realty Delaware Home Search)


Larry,

Nationwide, including Alaska and Hawaii.

Mike in Tucson

03/26/2008 11:41 PM by Mike Jones (Tucson Mortgage Company, LLC)


This could be some very uplifting information for some folks - I'll spread the word in my corner of the world.

03/26/2008 11:43 PM by Kent Simpson REALTOR®, e-Certified®, AHS® (with The Pepper Group™ Diversified Real Estate)


Mike, does this program apply to a mortgage on a second home, or only to a primary dwelling?

03/26/2008 11:49 PM by Wayzata Lakes Realty: Eric Kodner Sells Luxury Homes


Mike:
Get post.  I like the idea of helping the home owner keep his home.  I wonder just how many orginators will make this known, especailly since they get NO enumeration for help the home owner.  I would think insurance companies will.

03/26/2008 11:50 PM by Bob Force (REALTOR®) Silver Spring Md. (Weichert Realtors®)


Always something Great here, just like Susan said...she summed it all up for us all!  Nice Job!

Take Care,

Tom Davis Delaware Realtor

03/26/2008 11:51 PM by Delaware Real Estate :Dover Homes: Tom Davis : Delaware Real Estate Search:FREE (FREE: Home Search: Delaware: Harrington ERA Realty: DOVER:DE)


Tom,

Oops!  You slipped in there while I was reciprocating!  Thanks for commenting! 

Bob,

The person who has the capacity to do the most good is the loan officer.  I think if my LO called me when I was in trouble, and helped me out of a jam, I'd be the biggest fan and referral machine you could imagine!

Eric,

First, second, and INVESTOR!

Kent,

Ditto what I said to Bob.  As a realtor, imagine the good will you will garner by spreading the word!

Mike in Tucson

03/26/2008 11:54 PM by Mike Jones (Tucson Mortgage Company, LLC)


Mike in Tucson- This is a great program for a lot of homeowners. Thanks for sharing.

03/27/2008 12:19 AM by Mark Horan P.A. "The Resident Chef" at Keller Williams (The Resident Team at Keller Williams At-The-Lakes)


Mark,

You bet!  Thanks for commenting and for your email.

Mike in Tucson

03/27/2008 12:23 AM by Mike Jones (Tucson Mortgage Company, LLC)


MIKE - Thanks for sharing this very helpful information.  I know that people are having trouble now, so anything that can be done to help is worth looking into.

03/27/2008 04:18 AM by Adam Waldman - Long Island REALTOR® (RE/MAX Best)


Mike, thanks I didn't know about this program. I will google it and send it to a few people I know from there. Have you used the program yet to help anyone?

03/27/2008 06:00 AM by Missy Caulk Ann Arbor Real Estate (Keller Williams Ann Arbor, Michigan)


Thanks for the  info Mike. I'm going to pass this along to a few homeowners that I know are struggling.

03/27/2008 06:56 AM by Lissa Uder, Your Lebanon MO Real Estate Agent (A Helper Premier GMAC Real Estate)


Lissa,

Thanks.  Pass the word along.

Missy,

Next week.  It starts in April.  I have people lined up for help when it starts.

Adam,

Thanks, Bud!  Spread the word.

Mike in Tucson

03/27/2008 07:58 AM by Mike Jones (Tucson Mortgage Company, LLC)


Mike,

Great post...I flagged and bookmarked!!! Thanks,   Fran

03/27/2008 08:13 AM by Fran 'The Title Man' Gaspari Title Insurance-PA & NJ (Patriot Land Transfer, Inc.)


Mike - this is great advice that I will be passing on! thanks!

03/27/2008 08:43 AM by Bill & Barbara Jo - Florida Realty Professional - AHWD (Charles Rutenberg Realty)


Mike,

 Do they contact the lender that they are in the rears with or Fannie Mae?

 

 

03/27/2008 04:18 PM by RE/MAX Premier Property Showcase


Cute pictures, Mike. How hot is it down there? I heard it hit 98 in Phoenix this week. Or is that just an ugly rumor perpetuated by Flagstaff real estate agents trying to sell second homes?

03/28/2008 12:23 AM by Ann Heitland, Associate Broker, CRS, GRI , ABR ~ Flagstaff Real Estate/Community (Team Heitland at RE/MAX Peak Properties)


Ann,

It was in the mid 80's today.  The sheep on the left came from Flickr, but I took the photo of the goat right here in Tucson.  They ARE cute, aren't they?  I hate to post without a photo or two to keep it visually interesting.

Rick,

You must contact your mortgage servicing company, not Fannie Mae.  The program starts next week, and I'll do some more research and write a followup post.  Thanks for commenting.

Barbara Jo,

Thanks!

Fran,

Ditto!

(sleepy) Mike in Tucson

03/28/2008 12:41 AM by Mike Jones (Tucson Mortgage Company, LLC)


Two questions will this be for only FHA loans or any loans and will it cover 80/20 loans. Also when you apply is it like the loss mitigation stuff that many times the buyer doesn't qualify for do to their financial trouble they are having.

03/28/2008 10:58 AM by Spokane Real Estate - Ross Quintana (Team Quintana Real Estate - MJ McAdams Realty Lic#3015)


Ross,

This program is for any loan.  FNMA (Fannie Mae) is not FHA.  The qualifications are listed in the article.  In order to qualify, you have to (1) be behind in your payments, and (2) show that you will be able to resume timely payments once your past due payments and costs have been paid by this new loan.

Mike in Tucson

03/28/2008 12:12 PM by Mike Jones (Tucson Mortgage Company, LLC)


WOW, WOW, WOW, Active Rain has done it again. This is the Best information I have heard in awhile. I will pass this on, o' boy will I. Thanks for the Blog Great Information.

Ronell D. Moore

http://www.ronellmortgage.com/

     

03/31/2008 11:26 AM by Ronell D. Moore (TM Holdings Group)


Excellent blog Mike, you did your homework!

03/31/2008 11:56 AM by Vertical Lending Services


I just visited FNMA's website.  It looks like a great program!  Hopefully it will help some deserving folks out.

 

04/01/2008 05:19 PM by Sohail Badruddin (Directors Mortgage Company)


Awesome info, this could be a huge help...  Thanks for the post!

04/10/2008 02:26 PM by Matt Odell, Indiana's Premier Mortgage Consultant!! (Sagamore Home Mortgage)


 

Thanks for the timely info.  Man, this is getting out of hand - what keeps the bwr that is barely making throw up his/her hands and say, "I am going to skip a few months...but, it's okay, I will be current in no time!"

I understand the intent of avoiding the foreclosure process with these bwrs, but isn't it inevitable?  Why is the bwr all of a sudden going to be capable, or even motivated to making future on-time payments?

04/10/2008 02:56 PM by Jeff Shatswell (Goldwater Mortgage)


Jeff,

A borrower called from Illinois the other morning.  She and her husband bought a new home, and the loan officer didn't explain that the taxes would take a sizeable jump in a year or so when the valuation process at the county caught up.  When the bank got the tax bill, they paid it, and hit the escrow account with the difference.  It happened at Christmas, or just after, and the borrowers have three 30 day lates.  It's a rolling 30 days, but the bank sent a notice of foreclosure. This program will reinstate them and allow them to stay on top.

Matt,

Thanks for commenting!

Sohail,

I talked with FNMA today, and the program is in pilot with Wells Fargo and a couple of other big servicers.  Its full rollout is delayed until May.

Randall,

Thanks for stopping by!

Ronell,

Active Rain is a great community.  Thanks for commenting.

Mike in Tucson

04/11/2008 12:09 AM by Mike Jones (Tucson Mortgage Company, LLC)


Great post! Didn;t know this was an available. Should help a lot of people in need of some help.

 FHA's MIP program will generally help FHA borrowers in that it can be used to bring a delinquent mortgage up-to-date. For more ideas about how HUD can help for FHA mortgages, go to http://portal.hud.gov/portal/page?_pageid=33,717348&_dad=portal&_schema=PORTAL

04/11/2008 08:50 AM by Lewis Corcoran (Amerisave Mortgage Corp.)


Mike I cant wait to see more info on this product.

04/18/2008 09:51 AM by Kevin Robinson (Crownline Home Builders)


This is huge.  I try to stay current on what is going on in our industry but somehow I missed this one.

04/18/2008 12:58 PM by Don Draughn - Mortgage Professional (Affordable Home Funding, Inc)


Joseph, Lewis, Kevin and Don,

It's a work in progress.  FNMA now says the program is in Beta, and will be rolled out in May.  From what I'm finding out, the borrower has to be able to show that they will have $200 in disposable funds AFTER being brought current and paying the personal loan.

Mike in Tucson

04/22/2008 10:21 PM by Mike Jones (Tucson Mortgage Company, LLC)


This sounds like a great program! I personally will help any of my old clients who need the help... Although the paper that I write generally Performs so I don't think that I will need this program very much. Still it is nice to know that there are programs like this out there. One thing that I am curious about (will research it) is; in Fannie's description of what the program it it says "HomeSaver Advance is designed for qualified borrowers who have fallen behind on their mortgage"... Once someone falls behind on their payments or even has one 30 day late they typically do not qualify for conventional financing. Are there separate qualifications that Fannie will apply to this type of a transaction? In other words if someone is 90 days late does that automatically disqualify them or will they still be able to benefit from the program?

04/23/2008 02:29 PM by Christopher Ohlsen (Lake City Mortgage)


Chris,

Actually, the borrower MUST be behind on the mortgage in order to qualify.  Lates are a requirement!  What they must be able to show is this:  Once the mortgage has been reinstated, and the borrower is again current, they will have a new payment for the personal loan from Fannie Mae.  They have to be able to show income sufficient to meet this additional payment, AND have discretionary income left over in the amount of $200. per month.

Mike in Tucson

04/23/2008 05:33 PM by Mike Jones (Tucson Mortgage Company, LLC)


Mike... I was pointed over here from Bill Archambault.  In any case, sounds like a great program. But don't ever assume anything. The loan will not allow you to cover late fees. Don't assume that all banks will allow you to pay this balance off and waive the late fees. I know some are stingy, for some dang reason. And think about this....  why do these companies or people come out with these programs, but don't make them 100% easy????   They give you money as a loan to get out of the whole, but it can't be used for late charges???  Does that really make sense?  It's like the FHA secure loan....  you can't do anything until your adjustment and you have to be late after the adjustment, not prior...  well, the rate is higher on the FHA secure loan. And those that are truly in trouble are usually in trouble before the rate adjustment...  lol

And you even listed income requirements and such....  and discretionary income..???  Not everyone will have that.... 

jeff belonger

04/27/2008 08:53 PM by Jeff Belonger -- The FHA Expert.com -- New Jersey mortgage -- FHA mortgages (Infinity Home Mortgage Company, Inc)


Jeff,

Don't you wish sometimes you could throw a switch and make things make sense?  Thanks for a thoughtful comment!  It's good to see you on my blog.

Mike in Tucson

04/28/2008 05:47 AM by Mike Jones (Tucson Mortgage Company, LLC)


AWESOME stuff. It's great to have a real, workable alternative to offer people besides calling the "Hope" Hotline, or short sale. Thanks a lot Jeff, on behalf of me and my clients.

04/30/2008 08:00 AM by Josh Holt (RE/MAX Coast To Coast)


This is the first I have heard of this program.  Do you know if the program will work if the owner is upside down in equity.

05/06/2008 07:58 PM by Laura Moore Godek (Laura Moore Godek, PC)


Laura,

I don't know.  Fannie Mae will have more info by the end of May.

Josh,

Thanks for commenting!

Mike in Tucson

05/06/2008 10:41 PM by Mike Jones (Tucson Mortgage Company, LLC)


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Loan Officer: Mike Jones (Tucson Mortgage Company, LLC)
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