In an effort to stabilize home values and to move our nation moving ahead in the direction of positive growth the government has pumped trillions of us dollars into the economy through various programs. Some of these programs were designed to spur employment creation as well as get credit flowing to the consumer and to keep borrowing costs low for an extended phase of time. California house owners who are still feeling the fiscal strain from the recession are having difficulty budgeting their mortgage, in most cases, and are looking for aid. The trouble with many home owners is their credit has taken a whack, their mortgage is under water, they are delinquent on their mortgage, or they simply don’t have the equity in their residence to refinance, so a home loan mortgage modification is their only option. Getting a lower monthly payment, for a lot of homeowners, would go a long way in getting them back on a more secure financial foundation. Home owners can benefit from a home loan modification since the monthly mortgage payment for anybody in the home loan modification program is going to be contingent upon their month-to-month income. Usually, in the home loan mortgage modification program, a property owner is going to lower their month to month mortgage cost to around 30% of their monthly income. This would help many home owners on the verge of defaulting or foreclosure, but there is a long process to undertake before receiving a home loan modification. They will have to fill out paperwork and go through a trial modification, that is intended to last approximately three months however some have been for a longer time, and there are stories of troubles in the modification procedure when dealing with lenders. Despite the fact that trouble and frustrations may occur, if you are in need of a home loan modification, talk to you lender and start on the process if you can and if it’s right for you. Even if you hit speed bumps along the way, don’t get bogged down in the process and keep in mind that a modification might be the thing to save your home and get you back on your feet. One such program that has been keeping mortgage interest rates artificially low for some time now is the FED’s mortgage back security (MBS) purchase program. The FED has committed to investing in $1.25 Trillion in mortgage back securities through March 31, 2010. The Federal Open Market Committee (FOMC) has continued to reiterate their intent to terminate this program at the end of March which is likely to have a negative consequence on the direction of mortgage interest rates in the near future. We anticipate mortgage interest rates to rise as much as 0.5% to 0.75% by the summer of 2010. Many real estate and mortgage professionals are saying now is the time to buy or refinance that home. With home values down as much as 50% in some areas, and with mortgage rates as historic lows, and homebuyer tax credits available for both first time and move up buyers, at this point is a great time to think about buying that home.
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The FED has committed to purchasing $1.25 Trillion in mortgage back securities through March 31, 2010. The Federal Open Market Committee (FOMC) has continued to reiterate their intent to terminate this program at the end of March which is likely to have a negative result on the direction of mortgage interest rates in the near future.
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