Qualify For A Mortgage Rate Of 2%

If you can do the qualification dance well enough today, you can get a mortgage refinance on your current loan for a mortgage rate as low as 2%. The government is willing to help you get your house payment as low as 1/3 of your gross income. You will have to do a little dance, but for 2% on your mortgage some people will do a lot of dance. Here is what the deal on this loan program is.

The program that I am speaking of is the Making Home Affordable program. This program only applies to the mortgages held by Freddie Mac and Fannie Mae. These are the giant mortgage holders that were taken over by the government about one year ago. They are cutting rates on mortgages to as low as 2% in an attempt to get the payment at or below 31 % of borrowers gross income.

First, you need to know if one of these two agencies owns your mortgage. Even if you got your home loan at a bank, it may be owned by one of these lenders now. These two large companies buy loans from commercial banks; they own a major portion of the nation's home loans.

When you visit the Freddie Mac and Fannie Mae websites, just fill in the information that they ask for about your home and yourself at both sites to find out if they own your loan. No matter what you think, this is worth a shot, you won't know for sure if they own your loan or not until you check. Sometimes the bank that you received the loan from will sell the loan to one of the agencies and then still service the mortgage, leaving you to believe the bank still owns the mortgage.

For a rough idea if your mortgage amount will qualify for the program, divide your mortgage payment by your gross income, this will give your the percent the payment is of your gross income. Do not forget to add interest, insurance, taxes, and principal together for the entire house payment.

Two other ways you will qualify are; If you have an adjustable rate mortgage that has almost doubled in payment and mortgage loan rates. The second is if you qualified for your loan with household income and one of you lost a job or had a cut in hours worked.

Qualifying past this point gets a little tricky. You are going to have to get your bank to agree that you are in a rough spot, but with the mortgage reduction, you will be much better off and be able to keep up with the payments. You will not qualify with a large savings account or without one. Your credit card debit must be under control and you should not spend a large amount of income on auto loans or private school for the kids.

You cannot be in to bad of position ether, for example, you won't qualify on unemployment income that is considered a 6 month income, and the requirement of employment is a strong chance of continued employment for 9 months or more.

There is just a little bitty window to squeeze through to qualify for this program. There was one lender that I read about that was quoted as saying "if you want to get the attention of the lender, you need to be delinquent by a month or two."

You can get help on finding out if you qualify for the program at the website for HUD or another non profit called Homeowner's toolbox says they can estimate your chances of approval.

It's a great time to be shopping for a house with exceptional mortgage loan rates available from reputable credit unions. For extra financial security, have a look at fixed GIC rate products.