Homeowners can avoid foreclosure and mortgage default be refinancing or getting a home loan modification through President Obamas housing stimulus plan. Millions of homeowners can use this plan to see savings of hundreds of dollars per month on their mortgage, and more importantly, save their home. Here is what you need to know to use this plan for yourself:

-Home loans which were signed prior to January 1st 2009 are able to use this mortgage bailout plan for their situation. Mortgages which were closed on after that are eligible for an $8000 tax credit, but that is different.

-Mortgages from Fannie Mae or Freddie Mac and are over 31% of a homeowners income, are eligible for a home loan modification. This modification will lower the homeowners monthly mortgage payment to less than they are paying now, or lower than 31%. This is a savings of 20% or more for a lot of homeowners.

-Homes which have dropped in value, can now get approved for mortgage refinancing or modification with this stimulus plan from the Government. Homeowners all over have seen their property values drop due to foreclosures, a bad housing market, tightened lending, and bad mortgages.

-Mortgages which exceed the homes market value by as much as 5% will still qualify for home loan modification or refinancing. Previously, a homeowner who owed more than the homes worth would never have a chance at approval.

Foreclosures and mortgage defaults can easily be avoided if a homeowner just takes action. The Government put this plan in place to help struggling homeowners, and if you are, you need to take control of your situation and get a mortgage refinancing or home loan modification through this plan before time runs out. You do not want to lose your home if you do not have to, and now you have an option.

By: Michael Petrone

President Obama and the Government have enacted their home refinancing and modification stimulus plan. This plan will allow millions of homeowners the chance to refinance or modify their current home loan into a new 2% fixed rate mortgage. Taking advantage is easy, and the savings easily add up to hundreds per month.

There are 2 Main Parts to Obamas Stimulus Package:

1) Home Mortgage Refinancing Assistance.

2) Home Loan Modification Assistance.

Here are some details on each of these Components to Obamas plan:

1.) Home Mortgage Refinancing Stimulus Plan

Using this plan homeowners are able to refinance through 2 of the biggest mortgage lenders in the country, Fannie Mae and Freddie Mac, even if their mortgages are worth more than the actual value of the home. The only eligibility requirements are that the home loan is financed or insured by Freddie Mac or Fannie Mae. Even if you are financially secure enough to be able to pay the monthly mortgage payment you can still take advantage of this plan.

Another condition of this plan is that the home to be refinanced is actually the homeowners primary residence. This refinancing stimulus plan from Obama only applies to primary residences not investment, or second properties.

2.) Home Loan Modification Plan

The Obama administration will be giving cash incentives to mortgage lenders who approve loan modification for “at risk” homeowners. Using this program, the homeowner will be able to avoid foreclosure, and get their home loan into a fixed 2% interest rate. Homeowners would also get to waive any late fees they have and their will be no closing costs associated with a home loan modification using this plan. Also, homeowners who take advantage of this plan will be able to get a mortgage payment that does not exceed 31% of their gross monthly income.

Refinancing a home loan using this plan will no doubt save millions of homeowners hundreds of dollars every single month. Taking advantage of this plan is very easy to, and even encouraged by Obama. Homeowners can use this to save their money and improve their standards of living. Also, this plan should restore some consumer confidence in the housing market.

By: Michael Petrone

Even the federal government and all governments in the major world economies are bailing out their ailing financial companies it won’t be enough as we can see right now. Thus it is very hard to make mortgage rates predictions. Mortgage and the housing industry is in uncharted territory. You can make your own projections or predictions as to where the mortgage rates are going but still won’t make sense a few weeks or months from now. Mortgage rates predictions are one of the hardest things to predict especially with the conflicting signals the economist are seeing.

Government intervention has made our traditional mortgage rate forecasters like newbies in this new era of mortgages and rate projections. It is extremely difficult to predict where interest rates are going. People made a living trying to predict where interest rate will go but nowadays it’s the same as it used to be. The models and the basis for calculations are no longer applicable as government intervention and bail outs played a role in determining the outcome of rates.

For instance the financial giants Fannie Mae and Freddie Mac which are publicly owned financial companies; both companies work behind the scenes in the mortgage industry. They buy and package home loans and then sell them to investors in Wall Street and around the world. But the thing with these two companies is that you cannot buy directly from them. They only buy from mortgage originating banks and lenders. This was a great idea because by buying the loans they free up money for lenders to write more mortgage and more homebuyers into homes. It’s like the merry go round of circle of loans.

These two financial giants own or insure almost half of the nation’s total which around five trillion dollars. Because of this the whole world is watching them very carefully as to how they will manage through rough economic times. And more than ever the US government is closely watching them. Most US government experts and leaders believe that these two behemoths will soon collapse or is bound for failure. So the government stepped in and save what could have brought more economic and financial trouble to the US and the rest of the world.

But as you can see, even with the intervention and bail outs being done by the US and government and other countries doing the same, mortgage rates are still falling. Because of these bail outs and government interventions, it artificially looks good for the buyers because you can so many homes for sale and are cheap. Some even juice it up by giving a lot of incentives. But some people are still worried they may not last very long.

I do not blame those people who worried about buying cheap house for sale right now. The mortgage and housing industry is in uncharted territory. Never that these kind of things happen to the financial sector and al the experts are scrambling to find solutions and ways of making the right mortgage rates predictions. To make mortgage rates predictions now is like playing the Russian roulette. No one has the right answer because there is established pattern of how the markets and interest rates will go.

By: Shellaine Enfesta