FHA Home Mortgage Loan Interest Rates

One Response to “Can I refinance with FHA?”

1. Food for thought says:

   May 31, 2009 at 6:51 am

   What you are referring to is known as a “Loan Mod”, or Loan Modification. A Loan Modification is pretty much defined as a Modification of a home loan’s terms and conditions. This modification allows the home owner/borrower to have their mortgage adjusted to a payment in which they can afford.

   Loan modifications also allow for principle reductions based on the current market value of the home. For example, if you bought your home for $300,000.00 and now it is only worth $150,000.00, you can go to have the principle balance (the amount of money owed on the property before interest) reduced to $150,000.00.

   With so many borrowers in a negative position of equity, many are finding it extremely simple to simply walk away from their home. With Loan Modifications now being offered, it gives homeowners a new option that is both beneficial to themselves, as well as to the bank.

   Banks are extremely willing to work with borrowers in terms of modifying their loans. Reckon about it; if I owed you $300.00, would you prefer me to give you $150.00, or simply not give you anything at all? Banks are NOT in the business of home acquisitions. They are in the business of lending. If a lending institution can modify the terms of a loan in order to cut loses, refrain from foreclosure proceedings (expensive and time consuming), as well as retain a customer, they will. Not because they are such fantastic individuals, but because it will positively affect their bottom-line.

   You can simply call up your current mortgage servicer (the bank to whom holds the loan(s) for your property) and inform them that you want to initiate a modification of your current loan and principle balance. For more information, visit http://www.hud.gov/offices/hsg/sfh/nsc/faqlm.cfm .

   Hope that helped!

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