Fannie Mae and Freddie Mac homeowners have been able to take advantage of the Home Affordable Refinance Program, which has allowed homeowners in an underwater situation the opportunity to refinance their home loan to a more affordable rate and, in many cases, has provided affordability for homeowners to the point where they can avoid foreclosure. Programs like these which have been implemented to assist underwater homeowners have been coming to the forefront of home loan assistance plans as more homeowners are seeing a reduction in their property value and are facing difficulties as a result.
Recently, it was reported by the Federal Housing Finance Agency that refinancing through this Home Affordable Refinance Program increased in the third quarter of 2010 by 26%, and the report also revealed positive findings in terms of homeowners who were struggling to make their mortgage payments. There’s also indications that homeowners who have had a home loan modified within the last three quarters are doing much better three months after their home loan modification compared to loans which have been modified earlier in the life of these mortgage assistance programs.
Yet, there are reports concerning home loan refinancing which seem to believe that programs like the Home Affordable Refinance Program, despite seeing increases, may be at the end of this spike in the number of refinancing opportunities that are available. Obviously, many homeowners who refinance their home loan through either a traditional refinancing opportunity or through options like HARP’s specialized underwater mortgage refinancing option are simply looking for a lower interest rate on their home loan as a way to make their payments more affordable.
However, there are those who predict that mortgage interest rates will climb throughout 2011 and could make refinancing, and even home buying, more costly to some and may prevent homeowners from benefiting from refinancing or could simply put some homeowners in a position where they feel that refinancing is simply not worth the cost.
On the other hand, there are still those who feel that mortgage interest rates are quite low at the present time and for homeowners who can qualify, refinancing may still be an option as there are rates which remain quite low and can benefit homeowners in a troubling situation. However, issues like underwater home loans and unemployment still remain a factor in preventing some homeowners from either benefiting from refinancing or even qualifying for a refinancing opportunity, as closing costs or drops in homeowners’ credit scores have been hindrances for those in a troubling financial position. However, the Home Affordable Refinance Program is still available for homeowners who are having trouble making an underwater home loan payment despite predictions that overall refinancing may remain flat in the coming months.