For homeowners who may be struggling to pay their mortgage, a rescue could be just around the corner. The Federal Housing Finance Agency (FHFA) decided to re-crunch the numbers and revisit reducing the principle of particular mortgages – specifically those backed by Fannie Mae and Freddie Mac. With this new program, the FHFA attempts to foster sustained income from distressed homeowners and forego foreclosure proceedings on the negative equity stricken mortgage(s). Put another way, FHFA is considering giving underwater borrowers a new deal on their loans, including reducing the amount of your mortgage.
Although not a real revolutionary idea, the FHFA’s willingness to challenge current policy maker’s views – that principle reductions do not follow best business practices and could lead to setting unwarranted precedents for future distressed real estate markets – could nevertheless deliver a win-win for lenders balance sheets and the negative equity concerns. In other words, the Federal Government finally believes reducing principal and getting underwater borrowers back on the path to paying for their homes is in everyone’s best interests.
With over 4 million homeowners still currently struggling with negative equity in the United States, homeowners who have loans backed by Fannie Mae and/or Freddie Mac might have the opportunity to reduce their mortgage loan balances and reduce their payments. With this new option, you could begin restructuring monthly expenses without filing for bankruptcy, while also avoiding further damage to your credit score.
Details for the program are still being released as it is not final, however, as the requirements and restrictions are released to markets and homeowners – loans that were excluded from the current administration’s Home Affordable Modification Program will now have the potential of (similar) principle reductions. What does mean for you? It’s time for you to take charge of your finances once again and begin exploring how this new program applies to you.
At Schwartz Realty, we can help you understand the best course of action and guide you through the process with ease. Let the some of the top realtors and agents in Las Vegas help you make the right decisions. For more information or to set up a consultation, give us a call today at (702) 485-1400.