CNNMoney.com published a pretty good article listing some more requirements for people hoping to qualify for a “HOPE loan”, or the new FHA backed short refi loans that will soon be available. Here are a few highlights from that article:
Qualified borrowers must live in their homes and have loans that were issued between January 2005 and June 2007. Additionally, they must be spending at least 40% of their gross monthly income on all household debt to be eligible for the program.
They can be up to date on their existing mortgage or in default, but either way borrowers must prove that they will not be able to keep paying their existing mortgage – and attest that they are not deliberately defaulting just to obtain lower payments.
Before homeowners can get FHA-backed mortgages, they must first retire any other debt on the home, such as a home equity loan or line of credit. Borrowers are not permitted to take out another home equity loan for at least five years, unless it’s to pay for necessary upkeep on the home.
To get a new home equity loan, borrowers will need approval from the FHA, and total debt cannot exceed 95% of the home’s appraised value at the time.
If you think you meet these requirements then we can help you look at applying for the program. Rumor has it the new rules could go into effect on October 1, 2008. Bookmark this site and keep coming back here for more updates. Then fill in our contact form as we get closer to the date if you are currently upside down on your home.