New FHA Loan coming out!

By
Real Estate Sales Representative
A new loan product called the FHA Secure Loan is going to come the rescue of some homeowners who are unable to refinance at this time and to help stop foreclosure for many homeowners who are struggling with adjustable rate mortgages. President Bush announced plans today at the White House to expand the Federal Housing Administration so that an additional 80,000 risky borrowers can benefit from its mortgage insurance program. I believe that this is the first step by the White House to combat the war to help stop the foreclosure crisis.

Bush's plan would allow risky borrowers to qualify for FHA's mortgage insurance even if they have recently become delinquent, as long as they have relatively sound credit. FHA currently does not allow delinquent borrowers to qualify for loan insurance. It would also alter the code to help borrowers refinance their loans with FHA insurance.

Bush said that ``in the coming days'' the FHA will begin a new program called FHA Secure Loan that will permit homeowners who have a good credit rating but can't afford their current payments to refinance into FHA-insured mortgages. ``This means that many families who are struggling now will be able refinance their loans, meet their monthly payments and keep their homes,'' Bush said. ``We going to start reaching out and make sure people know this option is available to them.''

This is great for homeowners who can "qualify" for this program and I am anxious to see what the underwriting guidelines will be. That will show me exactly what this will do to assist borrowers to refinance out of their current ARM and into a fixed FHA Secure Loan.

A lot ( a whopping 1.9 million plus) of homeowners will still be left to fend for themselves as President Bush announced there would be no bail out for borrowers who purchased homes that he claimed they could not afford. He forgot to mention that many of these homeowners were pushed into these loans and properties with the help of these lenders and real estate agents who were just doing their jobs and hell if they could "qualify" for a loan then they can "afford" the home. They were acting on the advice of their "trusted" professional advisors. Isn't that why we have underwriting and guidelines? Isn't that how they determine the affordability or was that all a dream and those weren't really loans at all?

What about these people?

The FHA Secure sounds all honky dory but it will not be the answer to help stop foreclosure for most American's! The only answer is massive loan modifications that the President and Congress need to force lenders in helping their clients.
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Rainmaker
222,989
Michele Connors
The Overton Group, LLC & CB First Realty - Greenville, NC
Your Eastern North Carolina Realtor
Heard this on the noon news....we'll have to see if it is the cork in the dam or if it can actually work long term.
October 11, 2007 12:30 PM #1
Rainmaker
243,895
Mike Klijanowicz
Baltimore & Harford County Maryland - RE/MAX AMERICAN DREAM - Perry Hall, MD
#1 Baltimore & Harford County Maryland REMAX Agent
Thanks for the heads up on this information!  I will definitely share it with some of the buyers that I have now who are "on the fence"
October 11, 2007 12:36 PM #2
Anonymous
Anonymous
Anonymous
Micheal, this is not a purchase loan. This loan program is meant as a temporary means to refinance subprime borrowers into low fixed rate FHA insured loans. By ignoring late payments after the adjustment date and allowing any liens beyond what the home is worth to be subordinated and hold second position, the government is hoping to stem the tide of foreclosures. Will it work? I couldn't say, as I haven't seen any lenders actually offering this product yet, even though it has been talked about extensively for the last 2 weeks.
October 11, 2007 08:28 PM #3
Rainer
68,727
Kris Krajecki
Kris Krajecki - FOX VALLEY MORTGAGE - Huntley, IL - Huntley, IL
Mortgage Broker Huntley, IL

FHA Secure is ALREADY out.

:-)

....and is working...for me, for now at least!

October 19, 2007 10:38 AM #4
Anonymous
Anonymous
Nikki

 Does anyone know what the qualifications are to obtain a loan like this.

I need more info.

November 27, 2007 12:52 AM #5
Anonymous
Anonymous
F R

They do need to force lenders to help borrowers that got sucked into this subprime mess especially by predatory practices.  Remember something, the "loan officer" is not always honest.  They can put anything on the application and push it through.  They can do things like writing very convincing (fake) letters so the lender will make an exception in some cases.  There were a lot of shady loan officers from about 2002 to about 2007.  I hope that when the credit crunch and mortgage mess is fixed, organizations will think twice about hiring people with little or no experience because they are the reason America is in this mess to begin with.

July 23, 2008 01:03 AM #6
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Rainer
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Anthony Fico

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