Yesterday I started a series of blogs to provide brief explanations of acronyms for some Federal Programs that we have heard much about, but may not know what the program or acronym stand for. As I stated yesterday these blogs are not meant to go into in debth explanations of each program, but to give just enough of an explanation that those reading these blogs will be able to have a basic understanding of each program, and be able to remember them.
The first acronym and program was HAMP (Home Affordable Modification Program), and today I will cover HOPE.
HOPE aka H4H (Hope for Homeowners)
Was launced by the Bush Administration, and was a program to refinance homeowners into new affordable loans through FHA through the Economic Recovery Act of 2008.
HOPE was to be offered and originated by current Lenders as a fixed rate payment program for primary residence properties. Hope was for homeowners that had obtained their mortgage on or before January 1, 2008 who had made at least 6 payments, and the mortgage payment was more than 31% of their Gross (pre-tax) Income.
The new HOPE Mortgage was to:
- Be no more than 90% of the new appraised value, including any financed Upfront Mortgage Insurance Premium.
- The holder(s) of existing mortgage liens had to waive all pre-payment penalties and late payment fees.
- The existing subordinate Lender(s) had to release their outstanding mortgage liens.
- The standard FHA policy regarding Closing Costs applied, and could be paid by:
- The homeowner
- Servicing Lender
- Third Party
- Originatin Lender through premium pricing.
- The homeowner had to agree to share with FHA both the equity that existed at the beginning of the new mortgage, and any future equity.
As you can see from the above discription this program was doomed from its inception. There just was no way that Lenders and homeowners were going to agree to these stipulations. Hope met with the same faith that many of the Federal Programs met before HOPE and after HOPE. There was no hope in HOPE.
In the next blog in this series I will cover HARP and Homepath.
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Who To Call For Your Mortgage Needs In Connecticut:
George Souto NMLS# 65149 is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308 gsouto@mccuemortgage.com, or visit my McCue Mortgage Homepage.
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