How about if you have a second mortgage…what should you do? Borrowers with both a first and second mortgage might still be able to qualify to refinance under the Making Home Affordable Program. The amount due on the first mortgage needs to be less than 105% of the value of the property. Eligibility will depend, in part, on the agreement with the lender that has your second mortgage and on your ability to meet the new payment terms on the first mortgage.

One objective of the Making Home Affordable Program is to give borrowers who work hard to pay their mortgage an opportunity to get into a mortgage with payments that are affordable now and for the life of the loan. For borrowers whose mortgage rates are much higher than the current market rate, they should see a reduction in their monthly payment.

Borrowers with interest only loans or borrowers with a low introductory rate may not necessarily see their current payment go down by refinancing to a fixed rate. However, they could save a lot of money over the life of their loan because once the introductory rate is over and their interest rate goes up, they will see an increase in their future mortgage payments. Fixing in at a low rate now could be smart for the long term

This entry was posted on Thursday, April 2nd, 2009 at 12:32 pm and is filed under Real Estate Industry News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.