How To Use Obama's Mortgage Stimulus Plan and Refinance a Mortgage

President Barack Obama has enacted a mortgage stimulus plan which will allow millions of homeowners the opportunity to refinance their home mortgage into a 4.5% fixed rate. This "Home Affordability Program" will give homeowners the chance to save hundreds of dollars per month. Here is how:

Currently, there are numerous grants available to homeowners, regardless of their credit rating. This government program is targeted towards people who need short term help. These grants can be used for loan repayments

There are loan modification programs available to homeowners who are facing "Financial Hardship" this can be, medical bills, loss of income or job, other debts. These loan modification programs will allow homeowner to have a monthly mortgage payment that is no more than 31% of their gross monthly income.

Also, the total amount of all other debts, including mortgage payments, must not exceed 51% of the homeowners gross monthly income.

The Federal Reserve and President Obama would like to see mortgage interest rates locked into a low 4.5% for all current and potential homeowners.

Homeowners can save on the cost of a mortgage counselor by getting free help from HUD appointed mortgage counselors, who act as representatives for you when talking to banks or lenders, for free.
Homeowners who have seen the value of their property fall by 15% or more during this mortgage crisis will be able to refinance into a 4.5% fixed rate home loan. This will help homeowners who have seen their property values drop as the housing market crashed.

President Obama knows that the economy is facing hard times and is trying to help homeowners. The government has set aside over $75 billion dollars to help homeowners refinance their mortgage. Home foreclosures are on the rise and home prices are falling. This mortgage stimulus plan will help to stabilize the housing market and with that, home prices will start to rise. Refinancing a home mortgage the right way will save you a lot of money, especially with this "Home Affordability Plan" from Obama. Take advantage of this great chance and speak with a mortgage lender or bank.

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Do You Meet Requirements For an FHA Loan?

Many people have a dream of owning their own homes. Some of these people feel they will never succeed at this dream. However, with the help of an FHA loan they may well be able to buy a home. These loans are backed through the Federal Housing Administration and are much easier to qualify for than other loans.

There are still things that you are required to meet in order to receive a loan. This program has been created for people who have a tough time meeting the requirements of conventional lenders.

A loan that you apply through the FHA for is one for which you will not need to have a minimum income to get. However, you will need to show that you have had an income that is steady for the last three years, and you were able to pay bills in a reasonable amount of time.


The ways that an income can come in are through seasonal work, child support, VA benefits, unemployment compensation, retirement pensions, SSI, and several more. There must be a ratio met that proves you will be able to pay for a loan. With only 29% of the money you have coming in going for housing cost, and another 41% allowed going for long-term debt.

For a FHA loan you will need to have a down payment that you can place on a home. This amount needs to be equal to 3% of the purchase cost.

The Federal Housing Administration will also check your credit. However, for a loan through the FHA you don't need great credit. These loans again are made easier to qualify so more people are able to own a home. And people who have not established credit can still get a loan also. As long as the requirements are met there are several people who can now have their dream of owning a home.

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Mortgage Shopping Considerations

The right mortgage is the single most important fiscal decision you can make. This loan will affect you for 30 years, and any mistakes in selecting the right financial product will cost you dearly over the course of these 30 years. Begin your shopping excursion with the knowledge of your own credit profile. What you do not know can - and will - hurt you! Mistakes, wrong accounts, and also inaccuracies in your credit profile lead to a reduction of your overall credit rating. The lower your credit rating, the more money a mortgage loan will cost you. Thus, you credit rating is directly tied to the interest rate of the mortgage for which you are applying. Know what is in your credit profile, clean it up if necessary, and then apply for a mortgage loan once the credit rating is accurate.

Of course, before you can actually apply for a mortgage loan, it is a good idea to shop around for a favorable interest rate. Mortgage rates are rarely ever constant and instead appear to be in a constant state of flux. As such, they subject to change because of current economic changes, treasury bills, and of course also the bond market. While it is not necessaryto be as knowledgeable as a securities trader about these items, it does pay to know which way the mortgage rates are heading. If they head downward, try to wait out the market until they reach their lowest points. Conversely, if they are heading up, you may either consider waiting until the loan rates are once again low enough to be favorable, or if you want to lock in the current rate and protect yourself against actually having to pay more for the loan in the near future.

With credit profile and loan rates firmly checked, it is now time to decide on a loan product. There are a variety of loans specifically designed for the different needs consumers may face. Some loans are set up for those who wish to pay off the loan within 15 or 20 years. In other cases there is the loan product that is tailored for the borrower who anticipates only spending a short period of time as homeowner of a particular property - usually five years or less. These loans anticipate the change in ownership and are advantageous as they feature low payments at the onset of the loan, but later on actually increase. Someone who will only stay in a home for a brief period of time will find this kind of fiscal vehicle to be very advantageous.

Another set of considerations to think about are the various fees that are charged during the application process. These charges are added to the cost of the credit, which is the interest rate. They may encompass fees, brokerage commissions, charges, and in some cases also nonsensical costs that drive up the overall amount of money the new home is costing you. As a consumer you have the right - up front - to demand a fee schedule from a lender you are considering. Check through the fees and if they are too high, ask for the fee schedules of various other lenders as well. You may be surprised to learn that some borrowers have actually successfully negotiated lower fees and costs with their lenders!

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Low Mortgage Rates Gone With 10-Year Treasury Note Uptrending

Over the last eight months Americans have been spoiled with historically low mortgage rates. Some home owners had the opportunity to refinance close to or under 4.5%. Much of this was due to government interaction. The government, especially Ben Bernanke, did everything he could to force interest rates lower. While overall rates were heading down, the 10 year treasury yield was heading higher.

Anyone who knows anything about the credit market knew that the declining, low mortgage rates would not last. If the 10 year treasury rate was increasing, eventually home loan rates were going to follow. The scary part about it all is the fact that it seemed to all happen at once. Over the course of a three week period, home rates went from 4.8% to over 5.6%. This is an amazing jump for any type of interest rate whatsoever.

What is even scarier is the fact that many of the individuals who thought they were locked in under 5% will find that they are not going to get their mortgage funded because the lenders are seeing higher rates as well. Many of these home owners are going to feel that this is not fair and something should be done about it, but sadly, nothing can be done. If anyone is to blame for this mess it is President Obama and Ben Bernanke.

If they would have let rates been set by the free market system we would not be seeing a spike like this. They would already be set at the accurate range without the interaction of the Federal Government.
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Poor Credit Home Loan - What to Know About

Let's face it: The economy's on the rocks and it doesn't show any signs of improvement in the near future. People are struggling to pay bills, in certain instances, and though they may be late paying them, they're still being paid. If this is the case, and buying a home is just on the horizon, what to know about a poor credit home loan might be something worthwhile to take the time to learn.

To begin with, the term "poor credit home loan, " can go by different names. In the mortgage and real estate business these are called "subprime loans, " for the most part. This term, especially, has been the subject of much debate since about October of 2008, when the housing market began to fall apart, somewhat due to the effect of too many of these loans being held in too many lenders' portfolios.

Now, it's not that there's anything inherently wrong with a poor credit home loan being extended, when the conditions - and the buyer - are a good risk. There's a world of difference between a buyer who may have had a few slow payments on some credit cards and one who's just went into - or just emerged from -- a major bankruptcy. These days, it's almost a certainty that the latter buyers will have a difficult time in getting a loan.

But many other buyers won't have a huge amount of difficulty in getting a loan based on poor credit, though it's also a certainty that the interest rates are going to be anywhere from 1 to 4 or more points above what's called the prime lending rate. It's a good thing for many that these sorts of loans are still being extended, even in these troubled economic times.

Prime rates, for a fact, are generally reserved for buyers nowadays with credit scores (called FICOs) ranging from 700 to 800 or better. Almost nobody below 700 will score a prime loan in the current lending environment. And keep this in mind: Any delinquencies on the credit report the mortgage lender or broker will pull will have to be cleared up before any lending decision is made.

In fact, clearing up a credit report should be the goal of anybody prior to applying for even a poor credit home loan. In many cases, this can mean saving a full percentage point on the cost of any home loan, sometimes resulting in the savings of at least 100 dollars a month, and thousands over the life of the mortgage.

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