New mortgage rules will affect those who previously qualified for the sub-prime mortgage loans. The new rules will require borrowers who qualify for riskier loans to pay higher fees and interest rates.
Lenders are now required to make qualified loans to borrowers with elimination of interest-only loans, terms no longer than 30 years. Borrowers with bad credit who cannot qualify or afford these types of loans will have to apply for non-qualified mortgages which will allow for terms longer than 30 years with higher interest rates. Lenders can still offer loans with higher rates in the first five years.
The new laws are causing Fannie Mae and Freddie Mac to implement restrictive rules that are preventing millions of borrowers with good mortgage payment history from being able to refinance at the current low interest rates.
This reaction by Fannie Mae and Freddie Mac may result in additional foreclosures if borrowers are unable to pay their mortgage and unable to refinance. This rule should be looked at again and should be done on a case-by-case basis for borrowers.
Write your congressman and voice your opinion about the new mortgage laws. If you are having trouble refinancing your home contact NACA at naca.com or HUD at hud.gov.
1 comment:
Great post. It is amazing how little people know about what to do with your credit after a bankruptcy. Access to credit tools and education is the key to recovery!
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