There have been some indications that homeowners who are in an underwater situation on their home loan are facing trouble when it comes to finding principal forgiveness or refinancing options when they are current on their mortgage payments. Obviously, when it comes to dealing with underwater home loans, there is a great deal of confusion, difficulty, and frustration that has been experienced in general from both servicers and homeowners as there are issues which have arisen in relation to providing assistance to homeowners who may be in a position to afford their mortgage payment despite being in a negative equity situation.
Many homeowners are aware of options like the Home Affordable Refinance Program and various principal reduction plans that may be available through specific foreclosure prevention options or from certain servicers, but when it comes to finding help for homeowners who have not fallen behind on their underwater home loan payment, there may be fewer options that could be used to help these men and women find more affordability or some form of relief from their negative equity problem. As there are continued decreases being seen in some areas of housing, some cities have also seen slight increases in property values as well, but no matter what the projections may be it’s still apparent that homeowners are facing the loss of value in their home or may be in a position where overcoming value that has been lost previously could take quite some time.
It’s well known that many homeowners have come to the conclusion that they are unable to recoup losses in the near future on their underwater mortgage and many have walked away, which has spurred some banks to offer incentives for homeowners to stay in their home by offering reward programs to homeowners who remain current on their home loan payment despite being in negative equity position. However, when it comes to offering principal reductions or these incentives for homeowners to stay in their home, there are no requirements being made for servicers to specifically offer principal reductions or underwater refinancing opportunities.
Sadly, there have been homeowners who have found that if they are current on their home loan their bank is unwilling to offer any type of aid, and this is where frustrations have gotten to homeowners who may have seen substantial decreases on their home and are seeing properties being sold around them to new homebuyers at a reduced cost. Yet, problems arise when the issue of principle forgiveness is brought up due to the fact that there are some homeowners who may have only seen a minimal drop in their property value or for homeowners who may not have seen their property value fall, it seems unfair to these individuals that other homeowners are getting a portion of their mortgage principal forgiven.
Yet, homeowners who are in a negative equity position may be able to contact their servicer to inquire whether there are any in-house programs that may be offered to homeowners who are current on their underwater mortgage payments, whether they qualify for certain refinancing options like HARP, or homeowners may be able to talk to housing counselors available through resources like HUD or the Making Home Affordable Program as a way to explore options to address their negative equity problems. It must be remembered though, homeowners are usually in a position where they are behind on their mortgage payments or run the risk of facing foreclosure before many of these programs will be of help, so at the present time underwater homeowners may simply have to continue on making their payments in the hope that some form of relief will be offered in the future.