Loan Modifications ... Refinance
Present Options That Can Exist
It seems lately, that I've had more and more questions from homeowners about "Loan Modification", as they continue to struggle within today's challenging market and economy.
Agents and many of my other referral partners also want to know about them, and other financing options that might exist, too. THEY are getting quizzed by homeowners (and potential buyers) regarding Loan Modifications too ... especially now after the governments release of information regarding the upcoming HARP 2.0. It seems, you can't be doing business within the current market and not get drawn into these conversations. The reasons for "why" someone might need or want to modify their existing mortgage range from unemployment issues, to being "upside-down" and/or "underwater" with their current home loan. Simply being in need of some financial relief ranks up there in concerns I often hear too.
Naturally, when I get questioned as a mortgage lender, I first look to see if a "traditional" Refinance is possible for the homeowner. And if so, will it provide the much-needed relief that homeowner needs and desires? Most often as of late, I'm finding that the traditional Refinancing route is not one that can taken. Today's tighter mortgage underwriting standards simply make it more difficult and in a few cases, impossible for the time being.
Where does that leave the homeowner in need when that is the case? That means a loan modification of the existing mortgage with the homeowner's CURRENT loan servicer, is the remaining option.
If the homeowner has NOT missed any payments on their mortgage, the unfortunate and disheartening news is ... they will have a very difficult, if not impossible, time in attaining any loan modification. I know ... VERY frustrating, right?
If the homeowner is current with their mortgage payments, I now have a fighting chance with HARP 2.0 to assist them in their search for financial relief. That assistance relies upon the homeowner's credit and income qualifications, as usual. And if current property value is no longer a hurdle, HARP 2.0 should open-up some real opportunities to them. But there are two issues that surround the possible benefits that may be seen within HARP 2.0, as they stand right now.
First, we mortgage lenders still do not have the specifics we need from the government in order to take action on our clients' behalf regarding HARP 2.0. Again, frustrating ... as the government has done a fairly good job in making the public aware as to the existence and updating of the HARP program. The public is aware and contacting us mortgage lenders hoping for good news ... and of this writing ... we still do not have the details as to how we can move forward, apply, and utilize HARP 2.0.
We've heard rumblings. We've seen projections. We've read "guesses" ... but still nothing tangible to hang our hats on, as of yet. My personal belief is that we will need to hang on to our hats a while longer too, because we will not receive these much-needed program specifics until after the New Year, some say March, 2012.
To me, the second issue surrounding HARP 2.0 is this ... WHY should this concern Realtors or the local real estate markets?
In my opinion, helping homeowners Refinance, who might have otherwise lost their homes to foreclosure, or put another short-sale property on the market, is critical to regaining a sustainable housing market. Let's state the obvious: Foreclosures and short sales are options for the struggling homeowner. Neither is good; neither helps property values; neither helps reduce inventory. And again, in my opinion, reducing housing inventory is what we sorely need right now.
I see the bottom line being this: Until we reduce housing inventory and eliminate the short sales and foreclosures, we will be mired in static property values. Buyers will remain reluctant to enter the marketplace under these conditions.
In addition to keeping "bad" inventory from hitting the market, the lower payments after Refinancing will put more dollars in the homeowners' pockets, which will in turn trickle-down to more spending by consumers. Since we are definitely a consumer-driven economy, this is one way to help our country out of its' real estate malaise and help get us turned around and on the path to better financial health.
Homeowners (and referral partners) need to keep seeking-out educated, professional mortgage lenders that will provide sound and unbiased fact-based opinions ... especially when the homeowners seeking those opinions are emotionally and financially distraught or down-and-out.
Changes happen constantly and steadily in our industry. New options may become available for homeowners at any time. It is best to remain vigilant. Homeowners and mortgage lenders need to stay in contact, communicate, get it right.
New options, new programs, new underwriting demands, HARP 2.0 ... all remain in our future ... we HAVE to get it right, in an otherwise imperfect marketplace.
* Should you have mortgage, refinance, HARP 2.0 questions, credit concerns, or general lending and finance questions ... please contact me. I'll be happy to answer your questions and assist you moving forward.
I can be reached through any of the following convenient methods:
Direct: 815.277.4036 Cell/Text: 708.921.6331
Email: gene@chicagobancorp.com
Website: www.genemundt.com
Skype: 630.219.1316
Click here 4 a: NO Cost NO Obligation NO Obligation Mortgage Consultation
Gene Mundt, Sr. Vice President
Personal NMLS #216987
The Federal Savings Bank
1823 Centre Point Circle, Naperville, IL 60563
Skype! 630-219-1316
Thanks Gene! What a well written article on just what so many homeowners are asking! Thanks so much!
Gene -- well written, as usual for you. And yes, according the Fannie and Freddie we will have to wait until March to find out what the rest of the rules will be, and if we will really be able to help those who are underwater.
When HARP 2.0 does come down the pike, I'm counting on you to explain it in a way I can understand. Just so ya know...
Thanks Dagny! Hope you find it beneficial for your clients ... and educational, as well.
Steven: You're kind, friend! Thank you. I fear that many are going to be disappointed with the timing of the information received. Many were anticipating some relief coming much sooner. Hopefully the entire program makes the wait worthwhile ...
Liz: lol Wow! The gauntlet is thrown! I will definitely try my best Liz ... just for you! I hope this information becomes available sooner than later ... so many are hopeful that it will help them.
Gene
Its good to see HARP 2.0 coming. I know we have until March and who knows what may change by then, but it sounds good so far and will be beneficial to many that would not qualify for a refinance otherwise. I've received quite a few phone calls about the programs since it was announced, and now they are just sitting until March before we can do anything.
I know .. I've had the same experience. Hurry up ... get people excited ... then wait. SO frustrating for the consumers and homeowners that need assistance. I've been trying to get the word out that the timing of the info is most likely late winter, early spring. Keeping my inquirers informed. If we all do that, it will prove beneficial ...
I know I can count on you, John ...
Happy Holidays, my friend ...
Gene
Gene: Thanks for your all-consuming information. The word here at Legacy is we have to wait until March when the new Fannie Mae DU kicks in. Our investors are standing pat until then. Merry Christmas to you and your family!
Reposting! This information is so important for the consumer to receive and get informed.
Paul: We've been told much the same thing now. Rather frustrating for lender and clients. Drips of info come through, but nothing definitive, as of yet. I wish you and yours a wonderful holiday season, friend. Peace, good health, prosperity, and happiness to you ...
Maggie: Thanks for the re-blog. I'm glad you found the information so worthy and beneficial. Let me know if I can offer any further assistance regarding this ...
Gene
Gene, It will be interesting to see how this all pans out. Like many of the suggested "fixes" this one brought immediate excitement..and subsequent deflation. You are right with the "hurry up and wait" frustration. I am also wondering how many lenders are going to "play"....word I am getting is not that many. I cannot agree more with your belief that housing is the key to so much in our economy. I continue to be amazed that housing isn't even a topic of conversation for most of the politicians stomping the field. As far as I can tell, it is of little interest or concern to most candidates. That is very, very telling to me......
First ... where have you been??? Was thinking just the other day it'd been ages since I saw you ... and poof! Here you are! Wish I could get customers to show up that easily .. lol. But that said, I totally agree with you Dee Dee. It makes me think that not too many politicians truly "get it". They're myopic with their concerns and responses. All have pretty much the same canned responses and terminology to spew. Exactly why our industry is taking so long to heal. Time will tell just how much this new program ends-up assisting. I'm trying to keep the faith ...
Hope you and yours have a wonderful Holiday Season ... and a very prosperous New Year! Glad to hear from you,
Gene