On March 4, 2009, President Obama and the U.S. Department of the Treasury launched the Making Home Affordable program as part of a comprehensive strategy to get the housing market back on track. With this program, up to 9 million American families may get the opportunity to modify or refinance their home loans to a more affordable payment.

The program has two sub-programs; The Home Affordable Refinance program and the Home Affordable Modification program. Under the Home Affordable Refinance program, 4 to 5 million homeowners who have a Fannie Mae or Freddie Mac mortgage and a solid payment history will be eligible to refinance their loan. Normally, these borrowers would not be able to refinance because their homes have depreciated in value. With the new refinance program, these homeowners can take advantage of today’s lower mortgage rates or refinance their adjustable-rate mortgage into a more stable one. An important fact to be aware of is that the refinance program expires on June 10, 2010. This means the refinance transaction must be closed and funded on or before that date.

The Home Affordable Modification program is another option that will assist 3 to 4 million homeowners who are at-risk of foreclosure by lowering monthly mortgage payments. Guidelines set forth by this program are expected to become industry practice in applying affordable and sustainable mortgage modifications. A borrower is eligible for this program if their loan was made before January 1, 2009. Additionally, the borrower’s loan must be less than $729,750. If the amount owed is more than the home’s current value, the borrower is eligible as well. Non-eligible borrowers included those who are currently unemployed and those whose loan balance is more than $729,750. Investment properties are not eligible either. The deadline for modification is December 31, 2012.

Banks and credit unions are making every effort to prepare for the new program. Be patient while going through this process as it may take some time before lenders are fully up and running with the Making Home Affordable program.

Interested in buying or selling a home in the Coachella Valley area? Contact Patrick Stewart Properties.