In a Washington news release today, HUD announced it's NEW FHA-MAKING HOME AFFORDABLE LOAN MODIFICATION . Now loans backed by the Federal Housing Administration (FHA) will be eligible for payment reductions similar to the Obama administration's loan modification program currently in use on Conventional loans serviced by FannieMae and FreddieMac.
This program goes into effect on August 15. Distressed homeowners who have an FHA loan may be able to refinance to reduce their payments and avoid foreclosure.
The program was launched for Conventional programs in March 2009 and has helped 200,000 borrowers so far. The FHA program works differently than the conventional program, and allows loan servicers to set aside up to 30 percent of the total principal balance until the house is sold or the property is refinanced. Borrowers will not be charged any interest on that amount.
"We're bringing another important tool to the table to help struggling families who are desperate to keep their homes," Housing and Urban Development Secretary Shaun Donovan said in a statement.
If you have an FHA loan and have experienced a loss of income and are worried about making your mortgage payments, contact your loan servicer in August and ask about this program. Lenders who participate in the FHA program are being incentivized to do these modifications for eligble borrowers.
Interest Rates at market close 7/30/2009 8:00 PM
The Fed is consistent with its purchase of Agency MBS, buying another $20.2 billion in agency MBS over the last week. The Fed is still purchasing about 80% of all MBS.
Conforming Conventional 30Yr Fixed 5.375%
Conforming Conventional 15Yr Fixed 4.750%
Conforming Conventional 5/1 IO ARM 4.375%
FHA 30Yr Fixed 5.375%
* Above Conventional rate quotes are as of 7/30/09 on a Conventional $165,000 loan amount, primary residence at 80% loan to value, with a 720 FICO score. APR includes $1,200 in lender fees and 980 in title charges (title charges may vary). FHA Quote assumes a $125,000 loan amount and a 680 FICO score, and a 96.5% LTV. Documentation of income and assets required. No origination or discount points.
Comments(0)