Mortgage Relief Program: Mortgage Rates in US Stimulus

July 23rd, 2011 | Posted in Debt Relief

No financial planner would ever recommend a mortgage relief program (one form of debt consolidation) to get out of credit card debt. It is substituting secured debt for unsecured debt and you could lose your home over a bunch of unsecured credit card debt if you get injured or can’t afford your new higher monthly payments.

Fannie Mae and Freddie Mac, would provide these new loans which has a vast variety of mortgage relief program network from lenders, brokers, loan officers to provide these loans. The program would be capped at $300 billion. This new program would lure many new buyers into buying homes as save money on cost as well. The National Association of Realtors estimates that this program would sparks about half a million home sales.

With more buyers coming into market, it will reduce inventory and it would allow stability in real estate market. More foreclosures are coming and with lower mortgage rates, foreclosures will be vastly reduced, thus allowing home prices to rise again. The Senate began debate on stimulus package on Monday with hopes of reaching a vote by Friday. Republicans want to have mortgage interest rates lowers to 4 percent or 4.5 percent on 30 year fixed rate loans.

Debt settlement on the other hand is only a late pay on your credit report. Late pays bring down a 700+ FICO about 40-50 points, they bring down 600+ FICO’s about 30 points, and bring down 500+ FICOs about 10-20 points. But more importantly, the FICO goes back up more than the drop from late pays as we eliminate the debt so their debt to income ratio goes down to zero and their FICO is back up higher than it was before they joined a settlement program even with the late pays on there,
but we demand a withdrawal of the late pay entry as part of the negotiated settlement and get that 99% of the time.

To be considered by the government as an “at-risk” homeowner, you are unable to pay your mortgage and at the same time unable to sell your house because home values have plummeted. Often, at-risk homeowners under HASP entered into risky mortgage terms at the time of purchase. Funds under HASP will be used to give a loan modification to at-risk homeowners by either lowering their interest rate or extending the length of the mortgage in combination with a lowered interest rate.

Learn more about Obama Mortgage Relief Plan Qualifications.