While there has been some hope in the area of negative equity for homeowners who are looking for ways to make their mortgage payment more affordable or reduce their principal amount, some question whether current underwater assistance and refinancing programs are even helpful in general as many officials and homeowners are calling for faster action when it comes to reconsidering programs that are currently in place or proposing new initiatives that may help underwater homeowners either a find affordability or get rid of their current home.
Here in September, homeowners may have a limited number of options when it comes to dealing with their home’s negative equity, as the Home Affordable Refinance Program is still in place and a variety of mortgage servicers are still allowing short sales to occur in situations where homeowners are underwater and struggling to make their mortgage payment. Yet, these solutions are not necessarily available for every homeowner in a negative equity position, and in cases where homeowners can meet their mortgage payment but are in a severely negative equity situation, there may be fewer opportunities if any available at the current time. This is where refinancing talks have usually come into play because homeowners both current and falling behind on their mortgage could potentially benefit from lower rates, which may lead to lower payments, despite the fact that they have seen a drop in their property value.
As of late, there has been some news in the area of negative equity that may be positive as well since some cities are seeing increases in property values, but on a national level there are still a large number of homeowners who are facing a situation where they own more on their mortgage than their home is actually worth. Yet, it’s hoped that opportunities from programs like HARP may become more available as officials could potentially change qualifications and requirements to include more homeowners with more servicers.
While nothing is certain as of yet, homeowners are still looking to their bank and government programs for help, despite the fact that there seems to have been few changes made in a positive direction as of late. Again, current programs have been able to help some but initiatives like the FHA’s short refinance plan fell flat simply because there was a lack of participation and, in some cases, homeowners simply could not meet the qualifications that were in place.
Current refinancing opportunities and assistance plans are at least of some use to certain homeowners in an underwater situation, but there have been some indications that inconsistencies in how various banks deal with underwater homeowners have created situations where a great deal of frustration has arisen and some homeowners have simply walked away from their mortgage. This frustration can be understandable when a homeowner owes a great deal on their home and has seen their property value plummet over the past few years, but it should be kept in mind that some programs are offering principal reductions, refinancing options, and there are still short sale plans available to help homeowners currently struggling and waiting for more solutions or aid in the area of underwater mortgages.