Underwater Home Loan Aid For Homeowners And Housing Price Predictions–How Are Home Prices Affecting Homeowners?

Homeowners who have been facing negative equity issues may have noticed that there were some predictions for the remainder of 2011 that state home prices may fall further before hitting bottom and, hopefully, turning to recovery in the future. The question of how long this recovery will take and the severity of predicted drops that may be seen later in the year have some homeowners questioning what assistance options may be available, depending on their particular situation. While there are a wide range of actions that have been taken by homeowners over the past months, or even years in some areas where home prices first began falling, the way these prices are affecting homeowners differs as well and may constitute specific actions on the part of these homeowners.

There are predictions that home prices may fall another 3% or more, but again, could see a rebound in the early parts of 2012 but there are others who feel that even the simple start of the housing recovery process could take much longer.  However, homeowners are in different places in terms of how they have handled negative equity, due to the fact that devaluation affects these men and women differently.  Some homeowners are fortunate enough to be able to meet their monthly mortgage payment even when their home is underwater, but others are finding that complications have arisen that make meeting their mortgage payment almost impossible for one reason or another.

For homeowners who are able to pay their home loan, many have decided to wait out this drop in home prices and are locked into their home for the long-run, but there has been a great deal of coverage on those who have decided to just walk away, much like they would a bad investment.  What may make matters worse is there are some lenders who have stated that if a homeowner who walks away from their mortgage keeps other areas of their financial life intact they may still be viewed as a safe credit risk, but strategic defaults have been one of the problems that the housing market has had to face over the past months as well.

Yet, for homeowners facing payment issues, a bevy of option may be available for some as the programs that are currently available have been covered at length.  For those who are unsure of what options to pursue though, HARP or a home loan modification could offer more affordability in terms of a mortgage payment, but for unemployed homeowners with negative equity, new options like the Emergency Homeowners’ Loan Program is in place to offer payment assistance as well.

When it comes to housing values though, homeowners may be in a position where they are going to have to wait for a while before their property value returns, but this hasn’t been a major issue for homeowners who are able to afford their mortgage payment and plan to stay in their home for quite some time.  For those facing payment difficulties however, taking steps early like talking with a servicer or housing counselor so that options can be explored may help reduce the severity of a homeowner’s negative equity situation, but there may be few options when it comes to drastic reductions in a homeowner’s principal.