Homeowners with a mortgage that is owned or guaranteed by Fannie Mae or Freddie Mac may be able to benefit from underwater mortgage refinancing if they have seen the value of their home drop over the past months. Homeowners who have an underwater mortgage are obviously in a frustrating situation since they owe more on their home than their home is worth and it is understandable that many want assistance in dealing with this predicament.
Yet, many homeowners that have an underwater mortgage have been unable to use traditional refinancing as a means of making their home more affordable since a home that is worth less that the mortgage to which it is attached can’t be refinanced. However, Fannie Mae and Freddie Mac may be able to get a more affordable mortgage from underwater refinancing thanks to this form of mortgage assistance.
Homeowners with an underwater mortgage typically fall into one of two categories. They either want to be rid of their underwater mortgage obligation or they simply want a more affordable home loan payment so they can keep a roof over their head. Many homeowners have asked for principal reductions, but few lenders are offering this form of mortgage aid on a wide scale.
It’s being advised that homeowners talk with their lender or consult the Making Home Affordable website if they feel they are in the position to refinance their underwater mortgage or to see if they qualify for this type of mortgage assistance. An underwater mortgage is a difficult situation but there are options and ways in which a homeowner can manage their mortgage and even make owning an underwater mortgage more affordable.