New Laws for Distressed Homeowners facing Default (March 4, 2009)
As a Certified Distressed Property Expert (CDPE) real estate agent, keeping up to date on the new rules with respect to distressed homeowners and delinquent loans has been a full time job.
As of March 4, 2009, the US Dept of Treasury rolled out the details in regards to the Homeowners Affordability and Stabilization Plan (HASP). I will attempt to simplify the new rules, which there are basically 2!
1) Home Affordable Refinance - Homeowners that are NOT in default can refinance and take advantage of the incredibly low interest rates. Normally, these borrowers would not have been able to refinance because the property value has depreciated and therefore they do not have 80% or 90% loan to value usually required.
****If you have a high interest rate, an adjustable rate or even an interest only.. now is the time to take advantage of this program.****
2) Home Affordable Modification - Homeowners may qualify to have their loans modified which usually consists of 2 options: Lowering interest rates or extending loan terms (up to 40 years). The intention is to get your payment lower to make your home more affordable. The program will get your payment down to 31% Debt to Income, however, the lowest rate that can be offered is 2%.
Basic Requirements: 1) Must be primary residence and you must live there. 2) Only first lien holders are eligible 3) Loans originated prior to Jan 1, 2009 4) Can only modify once in program. **Other restrictions apply**
If you are considering one of these options, you can learn more by going to www.ustreas.gov or feel call me at 317 846-4888. As always, if the refinance and modification rules are not acceptable in your situation and you feel you need to sell the property, please call me! Your last resort is to let the bank take the property back through the foreclosure process.
Derek Gutting, The Gutting Group of Keller Williams Realty
317 846-4888 direct
