Making Home Affordable, also known as the Obama Refinance Program, was initiated by the Obama Administration in early 2009. Its aim is to help homeowners avoid foreclosure through refinancing and loans modified to lower mortgage payments. If you haven’t heard about the Obama Refinance Program, here are the four things you should know about this specific loan:
1. It’s strictly for owner occupants
You need to be living in the mortgaged property in order to qualify for the Making Home Affordable program. Applicable residences include:
- Detached house
- Condominium unit
- Duplex
- Triplex
- Fourunit residential properties
If you have an FHA or VA loan, the “primary residence” requirement may not be new, but it could be a different story for those with conventional loans.
2. Should be financed under Fannie Mae or Freddie Mac
Your existing loan should be owned or guaranteed by either of these government-sponsored enterprises (GSEs). The entities currently under government conservatorship are:
- Federal National Mortgage Association (Fannie Mae)
- Federal Home Loan Mortgage Corporation (Freddie Mac)
Each of these secondarymortgage corporations has its own set of rules and requirements. If you’re not sure whether your loan is financed by a GSE, call 18007 FANNIE or 1800FREDDIE.
3. The application process can be complicated
Applying to the Making Home Affordable Program can be a long and complicated process. This is because there are several layers of rules that need compliance. As mentioned earlier, Freddie Mac and Fannie Mae have their own sets of guidelines. The federal government also has rules governing how applicants are screened and assessed. Finally, lenders will have unique requirements that must be met so the loan can be originated. If you plan on getting into this program, it’s imperative that you understand all these policies and be patient enough to see the entire process through.
4. You need to be current on your mortgage
To be eligible for Obama Refinance program, you need to be current on your mortgage payments. Specifically, you should not:
- Be more than 30 days late on any mortgage payment
- Have any unpaid premiums in the last 12 months
Any instance of default, as defined above, will automatically disqualify you from the program. The right lender can guide you through the various stages involved in the application process. It’s important to find one with a good reputation and solid knowledge when it comes to this type of loan product. Simplify your search for the right lender by clicking on the link below. It opens up to a short form that will help us match you up with the right financial assistance provider. Quick, easy and absolutely free of charge. After deciding on a bank or lending institution, make it a point to complete the short self-assessment questionnaire. You can get information on this from your lender of choice or the program’s official website. The answers you provide will then be used as a gauge of your eligibility into the Making Home Affordable Program.
Justin McHood is America's Mortgage Commentator and has been providing expert mortgage analysis for over 10 years.
