Many homeowners who have seen a loss of value in their home have been seeking principal reduction plans or underwater refinancing opportunities to make their underwater mortgage more affordable. Obviously, homeowners who are in a situation where they owe more on their home than their home is actually worth are quite frustrated and, for those who are having trouble making their mortgage payments, are in need of underwater assistance.
There have been reports that state there are fewer underwater mortgages than in past months, but around 20% of homes are estimated to be underwater at the present time. This has been problematic for the housing market as many homeowners have either been unable to afford their home loan payments or have simply walked away from their mortgage due to the substantial loss in value they have seen.
Yet, there are certain mortgage servicers that are offering principal reduction plans for homeowners who qualify. While principal reductions are not something that are used on a wide scale, there are certain mortgage lenders who are offering earned principal forgiveness programs to homeowners who continue to pay on their home loan and for homeowners who want to be rid of their mortgage, short sell options have been offered as well.
Homeowners who are trying to simply keep a roof over their head but may be struggling due to their underwater mortgage may have underwater refinancing options in certain cases. The Home Affordable Refinance Program was implemented to help homeowners who are suffering from an underwater mortgage and may have a home that is owned or guaranteed by Fannie Mae or Freddie Mac. Homeowners in this situation may be able to refinance their home loan for a more affordable rate or payment, which can make dealing with an underwater mortgage a little easier.
Even though underwater mortgages are not something that are easy to deal with, there are options available to homeowners who have lost a great deal of value in their home over the past months. Underwater mortgage situations are very frustrating but homeowners are being advised to seek out these underwater assistance options and find ways to deal with their mortgage troubles outside of strategic defaults, which can be detrimental to one’s credit score for years down the road.