Federal Mortgage Refinancing

The United States government wants American homeowners to keep their homes so it has created a number of programs to help people avoid foreclosure.

Taking advantage of federal mortgage refinancing programs can help a homeowner reduce their mortgage payments and avoid foreclosure. These programs could give a person a lower mortgage payment, better interest rates and better mortgage terms.

Fannie Mae the government chartered corporation that underwrites a lot of mortgages has a number of refinancing deals available for homeowners. These programs are designed to help people whose mortgage debt exceeds the value of their homes refinance their mortgages and stay in their homes.

Who Qualifies for Federal Mortgage Refinance

To qualify for these programs a homeowner will have to have an existing mortgage that was issued by Fannie Mae. A homeowner can determine this by looking at their mortgage documentation. If the homeowner’s mortgage was issued by Fannie Mae they can qualify for Home Affordable Refinance.

This refinancing can help those who have Adjustable Rate Mortgages (ARMS) and other expensive mortgages qualify for a cheaper mortgage. This can reduce mortgage costs and help a family stay in their home.

The details of this programs and instructions for applying for it are available at www.efanniemae.com. Any homeowner who has a Fannie Mae mortgage should look into this program.

Homeowners who have mortgages issued by the other federal mortgage company Freddie Mac are also eligible for this program. The details of this refinancing can be found at www.freddiemac.com/sell/factsheets/relief_refi.html

When You Should Seek Refinance

There are a number of mortgages that a homeowner should try to refinance if they have them. The first mortgage a homeowner should try to refinance is an ARM. ARMS are a very bad deal for homeowners because the interest rates on these mortgages can rise substantially. This can cause the amount of mortgage payments to go up in the future.

A homeowner should refinance an ARM into a fixed rate mortgage. In a fixed rate mortgage the interest rate is locked in for the duration of the mortgage. This means the mortgage payments won’t increase in the future.

Homeowners should also seek refinance when the amount of their mortgage exceeds their home’s value. Federal programs exist to help homeowners whose mortgage exceeds the value of the home.

Refinancing to Avoid Foreclosure

Homeowners whose mortgages were not issued by Freddie Mac and Freddy Mae maybe able to take advantage of federal mortgage refinancing efforts. The Federal Housing Administration and state housing agencies have a program called Making Home Affordable.

Many homeowners who are facing foreclosure or have houses mortgaged for amounts that exceed the home’s value can qualify for this program. Homeowners can find more details about this program at  http://makinghomeaffordable.gov/