Recent changes to the Home Affordable Refinance Program are hoped to bring benefits to the homeowners who have been struggling with negative equity over the past months or even years, but there are some aspects of this plan, which are predicted to help less than 1 million homeowners, but may still prevent some from taking advantage of this particular refinancing opportunity and, as a result, questions have arisen as to why some homeowners may not benefit and how changes that are in place are truly helping homeowners that are in need. Understandably, there are well over 1 million homeowners who may be suffering from negative equity as there have been indications over the past few months that almost 25% of mortgages are deemed to be in a position where negative equity is in place, but changes in the federal underwater refinancing program have eliminated certain fees and the loan-to-value limit that may have been hindering some in the past, yet homeowners do need to remember that some aspects of this plan and changes may make them ineligible.

As an example, homeowners do still have a maximum limit for adjustable rate mortgages, but one of the more common issues that homeowners may need to look into when it comes to this program is whether they will benefit from refinancing. Homeowners are not guaranteed a lower rate when this program is available to them, as there are homeowners who may have fallen into an area of financial distress, missed payments, or may simply not have a good credit score where today’s low mortgage rates will be and option for them.

However, homeowners do still have options that may be available from their state housing agency, or directly from their mortgage servicer, that may help address negative equity despite the fact that such options as a principal reduction had not been widespread nor used by every mortgage servicer. The Home Affordable Refinance Program can be beneficial for homeowners and, as it does include more individuals than previously may have been able to benefit from this program, homeowners do need to keep in mind that they will not always qualify for this particular refinancing option, but again, homeowners do have opportunities to make their mortgage payments more affordable even when negative equity is in place, and if refinancing may not be an option.

The Principal Reduction Alternative plan and some principal forgiveness options that may be part of modification agreements could bring some benefits to homeowners in a negative equity position but of course homeowners who are hoping to take advantage of this underwater mortgage refinance program do need to keep in mind that the type of mortgage they have, their financial position and ability to refinance to a lower rate, and their servicer may all come into play as to whether this particular option for underwater mortgage refinancing will even be available or helpful for their specific mortgage situation.

Over the past months we have seen some workers borrow money from their 401(k), in the form of a 401(k) loan, for various purposes and, in some instances there have been homeowners who have used funds from their retirement as a way to apply money towards their mortgage principal at the time of refinancing as a way to apply cash to their principal balance, which may allow them to reduce their costs even further and potentially put them on a faster track to mortgage debt relief. Some financial professionals, such as Clark Howard, have even gone so far as to make the rare statement of urging homeowners, who can benefit to do so, to use funding from their 401(k) to participate in a cash-in refinance, but of course this comes with a caveat as homeowners do need to be sure that they are on a financial ground that will allow them to not only repay the funds into their retirement account but also benefit from this particular type of refinancing opportunity.

Homeowners who have successfully used a 401(k) loan to refinance with a cash-in option are those who, in the majority of cases, can affordably repay the money that will have to be returned to their 401(k), and of course they have been those who have qualified for a more affordable rate, and have obviously done a great deal of good when it comes to paying down their mortgage principal. Since rates on home loans, like the average 30-year fixed rate mortgage or the 15-year fixed rate home loan, still offer incredibly low interest rates at the present time, with the 30-year rate remaining around 4%, successful homeowners who have used a 401(k) loan to apply cash towards their principal at the time of refinancing have typically been able to get not only an affordable rate but potentially lower overall costs as well.

Some homeowners have made the decision to shorten their mortgage term, meaning they may have opted for a shorter home loan at the time they refinanced, and this coupled with applying money towards their mortgage principal has also helped some cut costs drastically in terms of the overall money they will pay on their home when all is said and done.

Yet, homeowners do need to realize that the costs associated with refinancing can be expensive, repaying a 401(k) loan will be necessary so that such drawbacks like defaulting on this loan and having the money received viewed as income, which then becomes taxable, are just a few of the factors that homeowners must consider if they wish to refinance at the present time. Understandably, low mortgage rates have been very attractive for homeowners who are in a position where they may potentially see a huge rate reduction, as well as lower costs, but homeowners are still being urged to consider all of the drawbacks that may arise when using retirement funds to apply cash towards their mortgage principal at the time of refinancing, look to see how beneficial refinancing will be for their situation, and whether all of the costs associated with cash-in refinancing can be met once they have completed the refinance on their current home.

Reports from the third quarter have indicated that there is data to show some homeowners are falling behind on their mortgage payments as delinquencies did increase, which has given some mixed opinions to the topic of mortgage delinquency as some officials feel that these problems that recently arose in terms of homeowners missing payments may not be an indication that we are regressing back into an area of trouble but there are also those who feel that these problems may indeed persist as unemployment, while viewed to be somewhat stable by some, is still quite high despite the fact that we have not seen increases as of late in the national unemployment rate.

Some feel that with continued high levels of unemployment and negative equity still in place, there are some homeowners who may struggle when it comes to making their mortgage payment as there are homeowners who are still turning to foreclosure prevention programs in the hopes of getting more affordable payments on their home loans. Yet, this does not necessarily mean that every homeowner who has seen delinquency arise during the third quarter or over the past few weeks will be in a position where this problem only gets worse, as there are also some positive numbers coming from the job market with jobs still being added, but of course we are a far from where many officials want the job and housing market to be before we see more prosperity and troubles like delinquencies begin to fall further.

Homeowners do have opportunities to avoid delinquency or find more affordability from both their servicer and state housing agencies in some areas, but of course these reduced payment programs are not always helpful to homeowners who are struggling to get by, and this also means that homeowners will likely face more foreclosures in the coming months before things get better. Understandably, some states are seeing more trouble in the area of mortgage delinquencies than others, as state unemployment numbers differ and some are well above the national unemployment rate, while others are well below this 9% rate as well.

There are officials who do have a more optimistic view as there are some areas where home prices and unemployment may be more stable, with other states who may still see problems when it comes to these areas of financial distress for homeowners, yet it’s hoped that as we enter into 2012 improvements will begin to be seen in home prices and the unemployment rate, despite the fact that predictions of continued foreclosures will be seen. However, homeowners are still being urged to pursue delinquency assistance programs that may help with either their mortgage payment specifically or their overall financial life in the hopes of getting in a position where homeowners can meet required debt obligations, even if financial problems are present.

Since delinquency does remain a problem in some cases, it could lead to homeowners filing bankruptcy, facing foreclosure, or participating in a short sale, in instances where negative equity and financial distress are in place, but of course there are still options that are available for homeowners who simply need a lower payment, may be in an underwater position, or may be unemployed and, despite the imperfections of these various programs that may help, homeowners are still being aided by these initiatives and it may help to prevent further delinquencies or financial problems for homeowners who do pursue these assistance programs.

Citigroup homeowners who were pursuing a federal home loan modification, in some situations, have fallen into foreclosure but according to the most recent Treasury Department reports that were released here in November more positive data has been seen. While foreclosure starts and completions are something that countless homeowners are attempting to avoid, it does need to be remembered that homeowners are still struggling in a variety of ways and, as a result, starts and completions in the foreclosure process have continued to edge up for many major financial institutions when it comes to homeowners who were unsuccessful at getting a modification.

Yet, there are still opportunities for Citigroup homeowners, and many others with a variety of servicers, to find the assistance they need, despite the fact that we have seen some increases in foreclosure starts, completions, or even homeowners filing for bankruptcy. However, Citigroup did see some potential positive movement, as foreclosure starts and completions did decrease for homeowners whose trial modification was canceled as the data given to us showing activity between July and August indicated that foreclosure starts with Citigroup decreased from 9,428 to 9,410, and completions during the same timeframe decreased from 2,047 to 2,043.

However, the number of foreclosures completed for homeowners who are not accepted for trial modification with Citigroup did increase from 7,184 to 7,397 between July and August 2011, but the number of foreclosure starts decreased from 7,025 to 6,955. Obviously though, homeowners in these specific categories within the modification program are not the only ones with Citigroup, or any other servicer, who are seeing foreclosures as a problem, as numerous homeowners who may not even qualify for a modification, may not apply for home modification plan, or who may pursue an alternative mortgage assistance program may also find themselves in a position where they face foreclosure as well.

Since foreclosures are predicted to rise in the coming months, it does need to be understood that homeowners may not be in a position to benefit from assistance plans, despite the fact that there are a wide range of programs that are currently in place, have been improved upon, and may potentially offer the benefits that homeowners need when it comes to avoiding the loss of their home. Yet, homeowners are still being urged to act quickly if financial problems arise as those with any servicer participating in a modification plan and do not necessarily have time to waste, in terms of attempting to stay afloat when financial problems have arisen, and in the past homeowners may have drained their savings or saw financial setbacks in other areas of their life as a result of attempting to pay their mortgage.

While the modification program is still in place to help homeowners and has become one of the primary resources that homeowners turn to, many officials feel that more needs to be done by way of helping homeowners for this initiative, and despite the fact that there are some servicers still seeing positive results and are being deemed by the Treasury Department to have an efficient program, homeowners do need to understand that they have to look at all aspects of foreclosure prevention, in terms of plans available, so they can make the best decision for their specific situation.

It was reported that activity in the housing market showed some improvement for the week ending November 4 as both mortgage applications and refinancing activity increased amid drops in rates that have been seen on home loans, and this has given some a positive outlook in terms of how consumers are taking advantage of these low rates, due to the fact that there have also been some concerns that homeowners have not taken advantage of low interest rates that are currently available on mortgages for a variety of reasons. Furthermore, some officials would like to see more activity in the area of home purchases as well due to the fact that homeowners may be in a position to refinance for more affordability but there are still arguments that remain that new buyers are potentially in a situation where an affordable home could be found for almost any price range.

Understandably, not everyone will be in a position to purchase a home but many properties across the nation have seen devaluation and, this fact coupled with low interest rates, can make a mortgage affordable for a wide range of consumers, as lower home prices may be found for those who are looking for starter homes or simply a smaller property, and this along with the potential opportunity to get a lower rate on a home loan could lead to more affordable payments and the likelihood that new buyers would be able to afford their home on a more long-term basis.

Obviously, affordability and missed payments have been an issue that some still struggle with as homeowners are still finding that making mortgage payments, in some cases, is troubling as modifications are still being sought out and homeowners are looking for ways to avoid a foreclosure or financial distress that may lead to bankruptcy. Unemployment and other personal issues in the lives of these homeowners have usually been the source of problems that homeowners are seeing in terms of being able to pay off their debt but of course there are some consumers who are simply worried about their future, in terms of their job stability or the housing market, which have led to some being hesitant to purchase homes.

While the Mortgage Bankers Association stated that mortgage applications increased by 10.3% for the week ending November 4 and the refinancing index increased by 12.1% from the previous week’s report, this is not necessarily a trend that will continue as there have been consecutive weeks that have seen declines in some areas, with positive results that have come from the housing market as well. However, it’s hoped that the ability of new buyers and current homeowners to purchase and refinance may indicate not only more confidence but the financial stability to take these actions and, may indicate that some consumers are on better ground in terms of their financial life and ability to either refinance or enter the housing market.

Wells Fargo homeowners who may be in a situation where financial distress is present and negative equity happens to be a problem have, in the past, turned to short sale and deed in lieu of foreclosure plans as a way to help them transition from their home when these problems are in place, and recently within the Home Affordable Foreclosure Alternatives program, Wells Fargo saw an increase in the agreements that were started and completed between August and September of 2011. Yet, homeowners do need to realize that a short sale on their home or surrendering their deed may not necessarily be best for their financial position, so it does help if homeowners do explore alternative assistance plans in some cases in spite of benefits that have been seen from these alternatives.

However, for those who have found that one of these foreclosure alternative plans will be best, Wells Fargo homeowners may benefit from these plans as, once again, the agreements started and completed did show improvement as starts increased from 7,760 to 8,476 and agreements completed increased from 4,225 to 4,798. Again though, homeowners do have options that may help them avoid seeking these alternative plans as there are also programs from Wells Fargo that can help homeowners who are even underwater as many who pursue a short sale will obviously be in a negative position but also unable to benefit from certain types of payment assistance.

Some homeowners have been able to take advantage of new rules set in place to allow for underwater refinancing, but in some instances a simple modification may work as well. Homeowners are often urged to look at state programs that may be in their area, as Wells Fargo can also help homeowners in this aspect but it does need to be remembered that homeowners will obviously differ in terms of their mortgage situation, financial problems, and potential solutions that will be beneficial.

While counselors may be able to help homeowners sort through these options, those who believe that a Home Affordable Foreclosure Alternatives plan will be the best as, again, there are some homeowners who may face the inevitable loss of their home through foreclosure even after pursuing foreclosure prevention options, and rather than file bankruptcy or lose their home to foreclosure, homeowners may benefit more in the long run by participating in these short sale opportunities.

They are not always optimal for homeowners, as short sales or deed in lieu of foreclosure plans can cause a decrease in a homeowner’s credit rating, it does need to be remembered that homeowners may be able to see more improvements if they can avoid financial setbacks that are the result of other debts that may be present and are suffering as a result of their mortgage payment difficulties. These foreclosure alternatives will not solve every problem but homeowners who are careful to consider their foreclosure prevention and alternative options may find that there are some benefits to be gained from the plans that are available from servicers like Wells Fargo when it comes to helping homeowners avoid further financial problems.

Bank of America foreclosure prevention assistance has come quite often through the federal modification program but homeowners who have either been denied modification assistance or had their trial modification canceled by Bank of America saw increases in the number of foreclosure starts and completions between July and August of 2011. This information on homeowners who are facing foreclosure was released here in November by the Treasury Department and has given some homeowners a better insight as to how those who are unsuccessful at a home loan modification plan are faring in terms of foreclosure.

Yet, homeowners do have alternative foreclosure prevention opportunities that may be more helpful but of course there are still increases being seen in the areas of starts and completions after homeowners have made their way through HAMP but found no success. As an example, foreclosure starts increased by over 1000 for homeowners whose trial modification was canceled between July and August, with almost 2000 foreclosure completions being reported during this timeframe as well.

Also, for homeowners who were not accepted for a trial modification initially, the number of foreclosure starts between July and August for Bank of America increased from 82,394 to 87,916. Foreclosure completions were reported by the Treasury Department to have increased from 32,094 to 37,143, but these numbers while they do continue to increase monthly for a variety of mortgage servicers do not indicate that homeowners who failed to acquire a permanent or even trial home loan modification have no other options. Bank of America does participate in not only proprietary modification plans but extension programs as well, which have been beneficial for some, but there are also homeowners with Bank of America who made be able to take advantage of specific plans like those from the Hardest Hit Fund, available in certain states.

Yet, for homeowners who do wish to avoid the loss of their home, rather than participate in a short sale or deed in lieu of foreclosure program as an example, many officials often point out that it will be necessary to address these financial problems early that may be preventing homeowners from paying their home loan on time as a certain situations may require programs outside of the modification that must be pursued by these Bank of America homeowners. Understandably though, there are no guarantees despite the fact that the servicers have made changes to their programs at the request of the Treasury Departments in hopes of meeting benchmarks, but homeowners do have multiple options available to them that may be beneficial and are worth exploring if foreclosure prevention is necessary for their situation.

Homeowners who have faced foreclosure and feel that a review may have been in their favor or are questioning whether their bank properly adhered to foreclosure practices when specifically looking at their case have seen that the Office of the Comptroller of the Currency has recently released information regarding foreclosure reviews in cases where homeowners have had trouble dealing with their servicer or have faced foreclosure that may have been the result of an error.

This could lead to some benefits seen by homeowners if a financial problem did arise as a result of errors and mistakes made by their servicer, there could be compensation given to the homeowner as there are those who can request a review which may benefit these men and women who have seen problems resulting from the foreclosure practices of their specific mortgage servicer. While there were some financial institutions that reportedly mailed letters to homeowners who may be able to request a review of their case, it does need to be remembered that not all homeowners are necessarily going to be in a position where they can have their case reviewed nor will this review process always guarantee that a homeowner’s foreclosure was unjust or caused a financial situation where distress arose.

Obviously, when the robo-signing scandal was first reported on and became a hot topic many began calling for changes in the foreclosure process as financial institutions may have simply been rushing these foreclosures through without properly reviewing potential assistance options or foreclosure prevention aid that might have been available for men and women who were indeed facing problems in terms of their mortgage payment. Many major financial institutions do participate in modification plans be they from private programs or the federal initiative, but there have not always been success stories out of these modification efforts and, as a result, homeowners who did see that foreclosures may not have been processed fairly or properly were even more distraught when foreclosure prevention assistance was not offered.

While changes to programs like the federal modification initiative and resources like housing counselors that are currently in place hope to help more homeowners become informed and avoid the problems related to errors, the Office of the Comptroller of the Currency has made resources available at www.independentforeclosurereview.com in the hopes that homeowners who were in a position where their foreclosure may have been questionable or the result of error can potentially find compensation in some form that may benefit them when the loss of their home due to foreclosure was processed improperly.

Increases that are predicted to be seen in foreclosures have some of the mind that this will lead to further problems when it comes to underwater homeowners and housing prices as many argue that not only are homes which are sitting empty in the housing market pulling down prices in some areas but there are also those who state that simple foreclosures in an area are leading to decreases in property values as some homeowners are seeing a substantial reduction in their home’s equity. However, there are some homeowners who may have opportunities to avoid foreclosure as many may either participate in various foreclosure prevention options or some may simply be in a position where they can benefit from alternatives to foreclosures like a short sale program.

Major mortgage servicers like Bank of America, Wells Fargo, and J.P. Morgan Chase, just to name a few, all participate in programs such as short sales, deed in lieu of foreclosure plans, and many foreclosure prevention initiatives that may come from a federal or private plan. Reduced payment options have been beneficial for some homeowners in the past, but as more foreclosures are being moved through the system there is evidence that these homes may be in a situation where foreclosure has been delayed for quite some time, and homeowners may have transitioned from their property without benefiting from these assistance opportunities.

Since there are some foreclosures that may be seen in the coming months that have been on deck and waiting from anywhere from a few months to over a year, homeowners who are in a position where negative equity is a problem do need to understand that there are some benefits to be gained from certain opportunities available for those in a negative equity position as recent news that has been circulating has made homeowners aware of negative equity refinancing options, but again there are some homeowners benefiting from opportunities to sell their home at a loss when financial distress in negative equity are in place.

Understandably, homeowners will not always be in a position to benefit from foreclosure prevention plans but if buyers can be found or a mortgage servicer will participate, there are those who may be in a position where options like these short sale programs can help despite the fact that some homeowners have seen a decrease in their credit score as a result. Yet, there are those who argue that a short sale will be much more beneficial in terms of their credit history when helping to avoid other areas of distress that may come as a result of foreclosure or bankruptcy, and homeowners may be able to get back on their feet in a shorter period of time, in terms of restoring their credit.

While this will not necessarily be the case for everyone who uses the short sale plan, as some homeowners have seen missed payments, delinquency, and even default in other areas of their financial life, focusing on foreclosure assistance through either prevention or alternative plans have been helpful for homeowners in the past and as further foreclosures are predicted to potentially lead to more negative equity and housing problems in some areas, homeowners who are currently struggling have been urged to contact their servicer, housing counselors, and simply begin exploring ways that they may find assistance on their underwater home.

Obviously, homeowners over the past months have been refinancing in the hopes of acquiring a much lower rate as current interest rates are still remaining around 4%, on the 30-year fixed rate home loan option, with a 15-year and 20-year mortgage seeing rates slightly lower, but even homeowners who may not qualify for these optimal rates feel that they may still land in an area that is substantially lower than what they have and, as a result, more affordable payments or lower overall home loan costs may be gained. Yet, the use of refinancing to acquire some form of debt relief on a home loan is nothing new, but with rates at their current lows there are more homeowners who have considered refinancing, despite the fact that we have seen ups and downs in terms of refinancing activity throughout 2011, questioning whether homeowners are either unable or unwilling to refinance in some cases.

Yet, recent reports have also shed light on how successful homeowners are at refinancing or if they are seeing success in terms of helpfulness when it comes to refinancing their home loan in the hopes of getting a lower rate and finding relief in a timely manner for some. Recently, Freddie Mac reported that homeowners are still seeing decline in their interest rate when refinancing and there are some homeowners who are, at the time of refinancing, lowering their mortgage principal by applying cash towards their mortgage when they refinance their home loan.

It goes without saying, homeowners will want to get the most affordable rate they can and the most favorable conditions as such factors as closing costs, interest rates, or other fees have have come from refinancing, even if they have not planned to use cash-in options that can help these homeowners make further strides down the road to mortgage debt relief when they close on their refinance. Yet, homeowners are told to be aware of these costs, make sure they understand how their financial position will impact their ability to qualify for a more affordable rate, and whether they are going to be benefiting from refinancing when it comes to your paying off their debt sooner or simply getting a more affordable payment on their home loan as a result of a rate reduction.

While homeowners who can refinance, for costs, and apply money towards their principal are usually those who see a great deal of benefits from doing so, this again is not something that all homeowners are able to do and, despite the fact that many men and women hope to take advantage of low rates and costs that may be acquired from the current conditions being seen in the area of mortgage rates, again it will depend on the homeowner’s particular situation as to how beneficial refinancing will be and whether they stand to see lower costs as a result of refinancing.