President Obama is announced a new refinance proposal which could possibly become effective soon. It is supposed to offer some relief for homeowners with properties “under water”. But is this really going to help?
The plan would offer homeowners the ability to refinance at lower interest rates without several important components, which typically causes them to be declined. This includes; NO need for appraisal, NO “risk based fees”, NO credit check and owner could have missed one mortgage payment within the year. Read the details on the plan in this document.
While it is good to hear they are actually trying to help struggling homeowners, it will be interesting to see if it helps or hurts the process. It seems like a good plan “on paper” but it does not address the millions of homeowners who still cannot afford to keep their homes and a short sale is their only way out. The plan is also only good for owners with good credit? If that’s the case, chances are, they may not be struggling as much as others. But if it helps the few who are still trying to pay on time and save their homes, they should be rewarded! However, in addition to this proposal it would be helpful if the President can push lenders to speed up the short sale process, which is slowing down sales and closings in the housing market.
According to news reports the President can enforce the new guidelines without the support of Congress. President Obama announced his new plan during a press conference this afternoon, in Nevada.
What do you think? Is this a good proposal? Would this help you? Or is it just a band-aid on a gunshot wound?
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