Yesterday President Obama announced his Homeowner Affordability and Stability plan and people are saying it could help 7-9 million homeowners. That is quite a few families!
There are many numbers being thrown around when talking about this plan, but the real magic number of the Homeowner Affordability and Stability plan is one. One as in the number 1.
You.
Will this plan help You?
The Homeowner Affordability and Stability plan is generally segmented into attempting to help homeowners with “help” for 3 different groups:
- Help for those people who are owe slightly more than their home is worth and are current on their payments
- Help for those people who are not current on their payments and are on the path to foreclosure
- Help for Fannie Mae and Freddie Mac
Help for people who owe slightly more than their home is worth and are current on their mortgage payments:
You can also read more about the help this group of homeowners can expect on the White House blog.
If you are in this group of homeowners, get ready! Start checking
current mortgage rates and get ready for more information on what it takes to
refinance your loan on March 4. On March 5th, get ready to get multiple
mortgage quotes from your favorite lender loan officer. Chances are good that interest rates are lower now than when you got your mortgage.
Help for those people who are not current on their payments and are on the path to foreclosure:
If you are in this group of homeowners, my advice is to be patient. Many of you are in the process of attempting to get your mortgage modified, in the process of a short sale or short refinance. My best advice is to wait until more details are announced on March 4th.
The reason for this advice is two-fold: first, your lender is probably trying to figure out exactly what the plan means to them so they can help you and second, nothing “worse” is probably going to happen to you by waiting for more information.
You can also read more about the help this group of homeowners can expect on the White House blog.
Help for Fannie Mae and Freddie Mac:
No matter what group of homeowners you fall in, this will be going on “behind the scenes” while you are working on your individual situation. The US Treasury is going to increase its funding commitment to both Fannie Mae and Freddie Mac, will continue to buy up mortgage backed securities and increase the size of the mortgage portfolios.
This is important to you because it will help ensure that someone will buy your mortgage – which will mean that you can actually get a mortgage. In simple terms, if there are no buyers of mortgages, then mortgages are not available.
If you own a home and are wondering if the new Homeowner Affordability and Stability Plan will help you, my best advice is to wait until March 5 when more information is released.
At that point, you should be able to know if the magic number is called.