Many underwater homeowners have been seeking assistance through short sale programs or underwater refinancing opportunities. Cases where homeowners owe more on their home than their home is worth are obviously quite difficult for homeowners who may be struggling to meet their monthly mortgage payment. There have also been instances where homeowners who have upside down mortgage have simply walked away since they view their home as an investment on which they have lost out.
Yet, some homeowners have been unable to obtain the assistance they need more are simply in a bad financial position and cannot benefit from any mortgage assistance that is tailored for underwater mortgages. In situations such as this, there are short sale option for homeowners who wish to avoid foreclosure due to the fact that they have attempted to save their home but because of factors like unemployment are unable to continue homeownership.
Short sell options are way in which homeowners and lenders can work together in order to allow a homeowner to get out from under their mortgage obligation without doing a substantial amount of damage to their credit score. Similarly, deed in lieu of foreclosure plans are also available to homeowners who can no longer afford their home loan but have attempted to gain assistance through various programs. Both short sale and deed in lieu of foreclosure programs have been used by various homeowners so that they can avoid taking a big hit to their credit score but also escape their underwater mortgage situation.
However, there are certain instances where homeowners have been able to refinance their underwater mortgage through the Home Affordable Refinance Program. Lenders handle underwater mortgages differently but there are cases where homeowners who have a home that is owned or guaranteed by Fannie Mae or Freddie Mac may be able to refinance even with an underwater home loan.
There are reports that housing prices are beginning to creep upward once again, but there are certain areas where home prices remain low and there are cases where homeowners are so underwater in their mortgage that it could take years for them to recoup any value lost. While, again, it is a frustrating situation for homeowners to be in, there are underwater assistance programs and alternatives available to those homeowners in this troubling situation.