Although the current low interest rates mortgage rates have many homeowners refinance in better conditions, many have not been able to benefit from these agreements. Tighter lending guidelines still a lot of home owners with no where to turn for help. In an effort to help save homeownership for many Americans, representative of Dennis Cardoza of California proposed a Bill house refinancing, which almost everyone to refinance.
HR 6218 is called the Housing opportunities and Mortgage Equity Act 2010 (HOME). It is designed to provide mortgage refinancing directly to homeowners who need help. If other programs for foreclosure prevention not default values to prevent further, this legislative proposal, if necessary, foreclosures and reward those who dramatically reduce their monthly mortgage payments even by economic struggle.
With lower mortgage payments have consumers to spend more money per month as a drag economy. in addition, this kind of refinance help eliminate strategic defaults and loan modifications.
The following are some of the details of the Bill:
-A qualified mortgage is a current or in the absence, as long as it's the principal residence of the borrower and owned or guaranteed by Fannie Mae or Freddie Mac, this residence can be a a family house, one to four family house, condominium, or a share in a cooperative ownership housing association.
-Any penalties for prepayment or refinancing and sanctions for non-payment or delinquency should be eliminated or forgive.
-The duration of the new refinance should be no more than 40 years.
-The administrator could not load the borrower fees for refinancing.
-Charges for title insurance cover will be reasonable compared to the cost for the same coverage available.All the costs relating to the refinance would be rolled into the mortgage.
-The company (Fannie Mae and Freddie Mac) will pay a fee of no more than $ 1,000 for each qualified refinanced mortgage that is the administrator.
-There is no assessment required.
-To pay for this, the old mortgages are paid off when refinanced. the new refinance will be financed by the sale of new mortgage securities.
Although lenders believes she is too will lose a lot of money if this law is adopted, it will probably be the best solution seen so far to address the issue of the endless foreclosure. it is interesting to see how this proposed legislation is developing, which will be added and what will be taken away or even if it will pass.
According to the website of the Congressman Cardoza, there are about 30 million mortgages guaranteed by Fannie Mae and Freddie Mac. the savings on this programme is expected to be huge and have estimated Morgan Stanley and JP Morgan Chase, an annual reduction of approximately $ 50 billion in mortgage payments are. the success of the current available programs still is questionable, would this proposed that almost everyone to refinance the answer to the speeding up of the economy.
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