A new program in Nevada aims to help struggling homeowners reduce loan amounts and refinance if they are current on their mortgage payments but owe more than their homes are worth.
The state will use federal housing money to provide as much as $50,000 to qualified borrowers who then refinance at lower interest rates under the federal Home Affordable Refinance Program.
The program comes after months of negotiation with federal mortgage giants Fannie Mae and Freddie Mac, the U.S. Treasury Department and the Federal Housing Finance Agency.
Previous discussions in Nevada about loan reductions didn’t succeed because they required a dollar-for-dollar match by lenders. So state officials proposed using some of the $194 million Nevada received two years ago as part of the federal Hardest Hit Fund – money to help states hardest hit by the Great Recession – to write down loan balances. About $75 million was set aside for principal reduction, but the state could seek permission to use more of the total fund down the road.
The program is kicking off in Clark County; where regulators estimate 67 percent of homeowners owe more on their homes than they are currently worth. The program is limited to owner-occupied homes with mortgages that originated before May 31, 2009, and are backed by Fannie Mae or Freddie Mac. A homeowner’s mortgage balance must be at least 115 percent of the value of their home and cannot exceed $729,750. Family income cannot exceed 150 percent of median income for the area. In Clark County that income threshold is $99,000 for a family of four.
Homeowners who meet those criteria will receive an information packet and application from the state.
According to CoreLogic, a company that analyzes mortgage data, the average homeowner in Clark County is about $50,000 upside down on his or her mortgage.
For a more in depth look at the program click here; http://www.lvrj.com/business/underwater-homeowners-offered-life-raft-156640585.html
For additional information, call 1-855-428-4357 or visit http://homemeansnevada.nv.gov/.