In a move aimed at furthering the success of President Obama’s Making Home Affordable Program, Freddie Mac announced several changes to its refinance offering under the program. Freddie Mac’s Relief Refinance Mortgage is designed to assist borrowers who are current on their mortgage payments but who would benefit from refinancing into mortgages with terms that better position them for long-term home ownership.
Once these changes are available,you’ll be able to refinance a Freddie Mac-owned or guaranteed mortgage with any lender affiliated with Freddie Mac. Previously, you had to work with the same lender who currently services your mortgage. In addition, to help reach more borrowers, Freddie Mac is increasing the amount of closing costs that can be rolled into the new refinanced mortgage.
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“We are responding to consumers’ desires to have more refinancing options,” said Freddie Mac Executive Vice President Don Bisenius. “As an added benefit, we are expanding the program and providing greater flexibility in financing closing costs. Freddie Mac is committed to doing everything we can to bring the benefits of the Administration’s Making Home Affordable program to as many borrowers as possible.”
You can continue to work with your existing servicer to refinance your mortgage if you want to. In the vast majority of cases, the current servicer won’t have to re-underwrite you, where a new lender would.
Freddie Mac will allow the lesser of 4 percent of the new refinance mortgage amount or $5,000 of closing costs, financing costs and prepaids/escrows to be rolled into the new refinance mortgage.
Freddie Mac’s standard post settlement delivery fees, up to a maximum of 2 percent, will apply to the Relief Refinance Program.
You can visit https://www.freddiemac.com/corporate/ and complete the online form to determine if Freddie Mac owns their mortgage.
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Tags: freddie mac, Home Affordable Refinance, refinance
June 12th, 2009 at 9:40 am
How hard is it to get a principle reduction while being current.
Todd Reply:
June 14th, 2009 at 12:22 pm
Beatriz is right…principle reductions are few and far between. Which makes sense from the lender’s point of view. If you’re current on your loan and don’t have a hardship, it will be impossible to get one. There are some lenders out there that MAY do a short refinance. Or, if you have a hardship and don’t qualify for the President’s plans, you may be able to qualify for the new HOPE for Homeowners program…but no one knows which lenders are participating in the new program yet.
I wrote an article on it last week…look for HOPE for Homeowners. I also did a call with Brent Lane about short refinances…you can check it out here.
Best wishes,
Todd
June 12th, 2009 at 10:39 am
Pattye, I am a loan officer in Las Vegas, NV have not heard of many lenders doing a principal reduction. If you think you have some equity you might try to do the refinancing on the President’s plan, up to 90% of the current value, IF your lender participates.