Refinance into an FHA loan to help pay your mortgage.
This program, which is part of the Hope for Homeowners program, provides mortgage refinancing assistance and was created to help at least 400,000 families from losing their homes, to help stabilize the housing market, and to also help protect neighboring home values. In exchange for an FHA guarantee on your mortgage, home borrowers need to share any profit from the future resale of a refinanced home with the government. This program will help many borrowers in danger of losing their home. It will help them refinance into lower-cost government-insured mortgages that home owners can afford to repay.
This mortgage assistance program also provides almost $200 million for legal assistance and financial counseling to help families in need stay in their homes.
This is not a bailout. It protects taxpayers by requiring both homeowners and lenders to take responsibility. In order to participate in this program, mortgage investors and lenders must take significant losses by reducing the loan principal.
Only primary homes are eligible help with paying their mortgage. Second or third homes, investment properties, and speculators will not be refinanced.
How can FHA help homeowners stay in their homes?
FHASecure provides homeowners who currently have a non-FHA adjustable rate mortgages (ARMs), who may be delinquent or current, and regardless of reset status, the ability to refinance into a FHA insured mortgage. With FHASecure, the mortgage lender will not automatically disqualify you from getting help just because you are delinquent on your loan. The lender may also offer you a second mortgage to make up the difference between the current value of your property and what you owe, including any standard refinancing costs.
Does it matter that the assessed or resale value of my home is now less than what I still owe?
Not necessarily. There are options. For example, your lender can agree to "write down" your loan principal to 90 percent of the home's current appraised value - which could even be far lower than your original purchase price and mortgage balance. So for instance, if a borrower with a current $120,000 mortgage is eligible for the Hope for Homeowner loan, and your house is now valued at only $100,000, your lender would issue a 30-year loan for $90,000, and they would then adjust the monthly payments accordingly.
The mortgage lender who needs to consider the refinancing would have to be willing to accept a short payoff on the existing loan, a portion of your future profits on the later resale of your home need to be shared, or the lender must be willing to hold a second mortgage to make up the difference that is needed to pay off the existing mortgage as well as the home's value. Find other ways to get mortgage help if your mortgage is underwater.
How far behind can I be on my mortgage to qualify? What if I am more than than 90 days behind?
There is not a limit on how many payments you've missed or how far behind you can be on your mortgage payments. Whether you're one month behind, current, or multiple mortgage payments behind, the amount of assistance provided will depend on the value of your property, how much you owe on your mortgage debt, and if the creditor or lender, or any other source, will take a second mortgage to help with bridging the gap between your home's value and what is owed.
Do I need to be delinquent, and for a certain period of time, in order to be eligible for FHASecure?
Definitely not. The FHA encourages homeowners facing any type of mortgage reset to refinance before they fall behind on their current mortgage, and Hope for Homeowners can help. Read more on FHA mortgage programs.
I have a conventional, fixed rate mortgage but still need help paying as I have fallen on bad times. Can this program help me?
Homeowners that are facing financial difficulties in today’s turbulent times and who may be unable to make their mortgage payments are strongly encouraged to call their lender. Many lenders will offer assistance to borrowers that will help them bring their mortgage debt and bills current. Homeowners should also strongly consider contacting a mortgage counseling agency to find out about additional programs that may be able to provide further help with paying bills, especially if your communication with the lender has not worked.
Are there any programs to help those people who are already in foreclosure?
It is possible that FHASecure may help those homeowners who are already in the foreclosure process, but each situation is unique. Some factors that are considered include the value of your home, how much you owe on your debt, and whether the mortgage creditor or lender is willing to offer a second mortgage. Homeowners who are maybe facing a foreclosure are strongly encouraged to talk with their lenders or counselors.
Another option is to enter into a principal reduction loan with the FHA. They offer a new service that will help homeowners who owe more on their home loan than their home is worth. Learn more on FHA Short refinance.
FHA Loan contact information and learn more
If you would like to learn more about the governments FHA loan program, or if you are facing a foreclosure or need help, dial (800) 569-4287 to speak to a housing counselor. They can advise you on various options, including the Federal Housing Administration (FHA) program.
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