Despite the fact that mortgage rates have recently hit a low, particularly for the 30-year fixed-rate mortgage, homeowners are still suffering from negative equity and there are some indications from officials in the housing market who feel that home prices may still have further to drop, which has been bad news for homeowners who are struggling to meet their mortgage payment when negative equity is in place. Traditionally, homeowners who may have had problems paying their mortgage were in a position where they may be able to take advantage of low mortgage interest rates by refinancing, but since negative equity is an issue for numerous individuals across the nation, alternative assistance plans have been needed.
Homeowners who are unable to traditionally refinance for more affordable costs on their home loan as a result of negative equity do have some options that may be available from the federal initiatives hoped to prevent foreclosure when an underwater home loan is causing problems. One of the more common programs is the Home Affordable Refinance Program, which is part of the federal home loan modification initiative and may allow homeowners to refinance for a more affordable home loan payment and rate even if they are in a position where they owe more on their home than it’s actually worth.
HARP is not the only opportunity that homeowners may have, though, as there may be help through the FHA’s short refinance program that could still be available to homeowners, but initiatives that have taken more of the spotlight as of late are those that may be available directly from state housing agencies. While the Hardest Hit Fund has been heavily reported on, homeowners are still facing issues that these programs may help to correct and, as a result, more people need to be made aware that these plans are in place to help with particular issues in certain states.
Despite the fact that some homeowners are still suffering from unemployment and this issue is at the forefront of problems related to homeowners being unable to afford their mortgage payments, even those who have a stable income may be burdened under the obligation of meeting payments on a home loan where negative equity is in place, as some states have seen a severe drop in property values and have led to some homeowners simply walking away from their home, but those in the housing industry are advising these homeowners to simply have patience and not give up when seeking affordability for issues like an underwater mortgage.
Homeowners can also take advantage of the HOPE Hotline as a way to get information from housing counselors that may be helpful for finding underwater mortgage solutions, but talking with a servicer or a state housing agency representative can also give homeowners more information about what options are available in their specific state and for their particular negative equity issue that could offer underwater refinancing assistance.