fha secure rate reduction planWith the growing number of mortgage defaults by homeowners hit by large ARM resets or Homeowners simply unable to make their mortgage payments, the FHA has decided to step in and help homeowners out where they can.  A new program called FHA Secure allows eligible homeowners to refinance into a secure, fixed-rate FHA loan even if they are in default.  The whole idea is to help homeowners keep their homes.

An FHA mortgage refinance may be just the ticket for cash strapped homeowners.  Mortgage rates are still low and those individuals that have an unwieldy ARM reset that could possibly put them into default can take advantage of this program and get a fixed interest rate and payments that they can afford.  You can visit the FHA website at fha.gov or check out the FHA Secure Mortgage site for more information.

Many people think that when the Federal Reserve lowers the Prime Rate, that an automatic reduction of the mortgage loan rates will ensue.  That is not the case as the Prime Rate is the rate that financial institutions charge each other for short term loans while a mortgage is decidedly a long term loan.  But don’t be disappointed that there is not a one to one relationship between short and long term loan rates.  Money is available through the FHA programs and the rates are reasonable, much more so than most of the ARM resets.

FHA loan limits are set to increase with recent legislation passed by Congress that will see FHA loan limits temporarily lifted from their current maximum of $362,790 to a new maximum of $729,750.  Contingent on location, homeowners could see mortgage relief masquerading in the form of lower fixed rates.  Thirty year fixed mortgage rates were at 6.2 % in the fourth quarter of last year and that is a solid reduction for many.  It could be enough to save their home.

There are many people that for innumerable reasons have been unable to make their mortgage payments even with a fixed rate.  The new plans by the FHA can even help them out by bringing them in at a lower rate and, in some cases, making money available to pay off other bills that have been causing the missed mortgage payments.

Whatever your circumstances, it behooves you to look into the FHA secure loans, FHA secure rate reduction plans or FHA mortgage refinance options.  The house you save could be your own.