New Initiative to Help Dallas Borrowers Struggling With Mortgage Payments

While the number of Dallas-area homeowners struggling to meet their monthly mortgage payments has dropped greatly in the past year, there are still many who live with the reality of being several months behind on the amount they owe to their lender. And nationwide, more than 1.1 million homeowners are at last three months behind on their payments. For all of these suffering borrowers, good news is on the horizon, and it comes in the form of the Streamlined Modification Initiative from the Federal Housing Finance Agency (FHFA).

The new initiative will follow in the footsteps of programs like the Home Affordable Modification Program, which along with other foreclosure-avoiding efforts by the FHFA, have saved 2.7 million Americans from foreclosure, according to the FHFA. But the main difference between the Streamlined Modification Initiative and these past efforts is one thing that those dealing with the headaches of late mortgage payments will love: a lack of paperwork.

The new program will simply allow qualified late mortgage payers to start paying at a new, lower rate, and if they can maintain this rate for three months, they will be eligible to keep the low rate for the remainder of their mortgage. The FHFA, Freddie Mac and Fannie Mae will attempt to achieve this by cutting interest rates on the life of a mortgage and also extending the life of a mortgage so that a 30-year mortgage becomes a 40-year mortgage.

CNNMoney gives an example of how this scenario would play out for underwater Dallas home borrowers under the new Streamlined Modification Initiative. A 30-year mortgage at $200,000 with a 5,5 percent rate, for example, would become a 40-year mortgage with a 4 percent rate. The end monthly payment for the borrower on this specific example? That would be $835, or $300 in savings a month versus the $1,135 a Dallas home borrower would have previously been paying. At this rate, the Streamlined Modification Initiative would be saving the borrower $3,600 a year.

We are mortgage experts and have years of experience helping Dallas-area borrowers with their home-financing concerns. Please contact us today to discuss you unique Dallas mortgage situation.