Many people desperately seek mortgage help so that they can catch up on late mortgage payments and pay off their mortgages every month. You can find yourself in a lot of trouble if you’re behind on your first, second, or third mortgage. Here, we’ll give you some clear refinancing tips and other mortgage advice that can help you secure your mortgage payments.
Only Refinance If Absolutely Necessary
First of all, it’s very clear that you should not refinance unless you absolutely have to. While refinancing can extend your mortgage term and even lower monthly payments, you may end up paying more money in the long run. Many refinancing companies exist just to convince people to refinance when it’s inappropriate.
When choosing a lender, be sure to select a company that is licensed in your state. Some very shady lenders out there use deceptive tactics to milk you for everything you are worth. Remember that it’s wise to get involved in a shorter term mortgage and make a big down payment. A large down payment can severely lower those monthly premiums. Also, you can take advantage of several different discounts offered by lenders.
Get Breaks with a Good Infrastructure
Homeowners who possess good homeowners insurance and have installed a strong security system and smoke alarms can benefit from breaks on their monthly premiums. It’s also important to negotiate with lenders before getting into any mortgage. Remember, regardless of what your contract says, it’s always possible to work in new language and make the mortgage benefit you more.
Government Programs Available
There are government programs available for homeowners who want to take advantage of low interest rates. The new $75 billion Homeowner Affordability and Stability Plan stimulates lending and borrowing by providing incentives for lenders to restructure home loans. You’ll generally need at least 20% equity in your home to refinance, as requirements for refinancing have gone up. FHA loans can help homeowners with debt acquire lower interest rate on their mortgages. If a homeowner’s property value has gone down, it may be very difficult to be eligible for refinancing or even federal loans. Loans above $417,000, also considered “jumbo mortgages“, are generally not eligible for refinancing. Conforming mortgages, however, generally are available for lower interest.
Stay Tough Even If You Have Bad Credit
At-risk homeowners may qualify for some loan modifications. Modifications can actually restructure home loan terms. Some borrowers may need to enroll in a HUD-certified program to qualify for these loans. Qualified lenders and borrowers can receive up to a 31% reduction in their monthly mortgage payments. These loans can generally be set for a period of five years, after which they return to conforming rates.
Principal Reductions Are Also Available
The majority of these reductions are interest-rate reductions, though it’s possible to obtain principal reductions as well. If you make payments on time, you can receive incentive bonuses of up to $1,000 a year. Investors, speculators, and “home-flippers” are not eligible for the program, as all applicants must actually occupy the home in question. Also, you can only obtain loan modifications if it will result in a net savings compared with the expenses incurred during a foreclosure. Capitalize on these new government programs so that you can lower your mortgage rates.