Obama Mortgage Rescue Plan 2011: Key Elements Of The Government Mortgage Help Plan

A roof above one’s head is a basic necessity. There would be very few people in the world who would not like to own a house. It is a dream they strive to attain. To buy their dream home, most people take out mortgages. The financial depression the world over suffered not too far in the recent past and the increased prices of everything are making it difficult for people to pay their mortgages off. To save people in such situations, the Obama government has come out with the government mortgage help plan. It is a part of the Making Homes Affordable Program. The program aims at enabling those who are unable to meet their mortgage payments restructure their loans or get home refinance. With this, they are able to meet their mortgages and keep their homes.

With the former administration, several mortgage rescue plans came out under President Bush’s administration. However, the problem mortgages continued to rise. They were hoping the mortgage crisis would bottom out, but we have yet to see a bottom in the housing market with it’s ripple affect in just about all industries. The problem with the mortgage bailout under the prior administration is that allot of homeowners were excluded out of that plan. The plan was set to modify homes of individuals who might have been able to qualify for a refinance, but many opted for a loan modification instead. There were provisions in the plan for Fannie Mae and Freddie Mac, HUD Loans, and of course many mortgage companies had provisions set for individual in extremely unusual circumstances. Many homeowners still did not qualify. For example, if a homeowner had too many bill and was always late on their payments, or if the homeowner did not have a HUD, Fannie Mae or Freddie Mac home loan or loan securitized by one of the above then they did not qualify. Unless they had privy information that some individuals in the mortgage industry might not even have, then they stood no real chance of getting a new lower loan payment.

The new plan that is still been worked out by President Obama is expected to take this mortgage rescue plan to the next level. It is believed to be the plan that will allow the market to bottom out which will stable the housing market, in turn which stabilize our economy,start creating new jobs and boost our economy. Some of the details that have came out to just a select few, but not with all of the details yet; it’s still sketchy. An overview of the plan with the remaining details are expected to coming out on March 4TH, 2009. Mortgage companies and homeowners alike are eagerly anticipating it’s arrival. Under the new homeowner affordability and stability plan, eligible borrower who are on time with their payments, but have been unable to refinance due to their home value eroding, may now have an opportunity to refinance into a new 15 or 30 year fixed rate mortgage loan. Fannie Mae and Freddie Mac will be allowing refinancing of loans that they hold or that are have been mortgage backed securities. If you owe more than your property is worth, eligible loans will now include loan where the 1St loan will not exceed 105% of the current market value of the home. Lets say you owe $315,000 on your loan but your house is worth at least $300,000 then you may qualify for refinance. The details will be announced March 4Th, 2009. Some of the requirements will include having enough income to make your new payments and having a decent payment history. This loans are limited to Fannie Mae and Freddie Mac backed loans.

There are different plans under the government mortgage help plan. This includes Home Affordable Modification Plan, Home Affordable Refinance Plan, and Payment Reduction Plan. The plan that the homeowner chooses depends on the extent of his debts as well as the advice provided by the Making Homes Affordable official website. The helpline is called the HOPE Hotline and homeowners can call and get advice on the type of plans available and on the best option in their given situation. The website also has an eligibility page where the homeowner can check if he falls under the criteria for seeking help.

The object of the new Obama Mortgage Rescue Plan 2011 is to provide help with an affordable fixed rate mortgage. Every loan refinanced under the plan will have either a 15 or 30 year mortgage option with a fixed rate interest. Which ends up giving the borrower tremendous savings over the life of the loan. This plan will not reduce the total amount owed on the loan. To find out if your loan is owned or if it have been securitized by Fannie Mae or Freddie Mac just contact your lender after March 4, 2009. Lender will start accepting application after details are handed out on March 4. So anytime after March 4, 2009 is “fair game” to start checking with your lender. Lenders will see tremendous increase in their call volumes and become very busy answering question. Many lenders might forgo many of their normal daily activities to accommodate the new calls they are going to be receiving after the announcement is given.

Learn more about Obama Mortgage Relief Plan Qualifications.