Interest rates are low, but some homeowners still find themselves stuck with old mortgages due to their high loan-to-value ratios or other qualification issues. The Federal Housing Finance Administration made a big announcement last week that will help if you’re in this situation. Here’s a quick overview of this offering.
About the New Refinance Program for Mortgages with High Loan-to-Value Ratios
Fannie Mae and Freddie Mac will be implementing a new finance program specifically designed for mortgages with high loan-to-value ratios. This will allow a larger group of homeowners to refinance and take advantage of today’s low interest rates. This new program will include the following features:
- No maximum loan-to-value ratio.
- No minimum credit score required.
- Appraisals not required in most cases.
- No eligibility cut-off dates.
Program Restrictions
There are a few requirements and restrictions that will apply.
- HARP loans do not qualify (unless they are first refinanced into a traditional government sponsored enterprise loan).
- Homeowners must be current on their mortgage payments.
- No payments must be missed in the previous 6 month timeframe.
- No more than one payment must be missed in the past 12 month payment period.
- Borrowers must have a source of income.
- The refinance must offer some type of benefit (such as a lower monthly mortgage payment).
Taking Advantage of this Program
Unfortunately, this refinance program for mortgages with high loan-to-value ratios will not begin until October 2017. If you are looking to refinance before this date, please contact me at 978-376-5389. I will take a look at your loan and personal situation to identify other programs for which you may qualify.