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Obama’s Stimulus Package Designed to Help Control Mortgage Payments | ArticlesBase.com
August 18, 2009 | Leave a Comment
The hardships and difficulties facing homeowners today have not been seen since the Great Depression. As the economies crumble, the continual decline in home values has caused the rates for foreclosures and bankruptcies to rise rapidly. This mainly due to two factors: first, with the falling economy many home prices are worth less than what people owe. Secondly, the climbing unemployment rate is causing many Americans to fall behind on their mortgage payments.
In order to help out the many Americans in this situation, President Obama has provided assistance through a Stimulus Package that allows homeowners to control their mortgage costs. Further information about the assistance measures can be found by searching for loan modifications and stimulus package for homeowners on any search engine or by visiting the lenders website directly.
One method of loan modification is the lowering the monthly mortgage payment by decreasing the interest rate over a period of time. In order for this to occur, the lender will require information on your financial situation to determine what is a reasonable monthly mortgage payment based on your income.
Before the stimulus package, you required at least 20% equity to qualify for loan modification. However, today that requirement has been eliminated allowing both existing and modified loans with Freddie Mac and Fannie Mae to participate in the new program.
With the new program, monthly mortgage payments will be limited to 31% of your gross monthly income.
As a result of the recession, interest rates have declined steadily from 6.5% to 5.16%. Homeowners with an adjustable rate mortgage can choose to convert to a fixed rate mortgage. With the current low rates, it may be worth considering to switching to a fixed rate mortgage.
Finally, monthly mortgage payments are further reduced by allowing the homeowner to extend the period of their mortgage by an average of 20-30 years.About the Author:
For tips and facts about how you can benefit from Obama's Home Stimulus Plan – or to find out if you qualify, visit our no nonsense home stimulus guide: http://ObamasStimulusPackage.net
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