Every year, hundreds of thousands of people and businesses go bankrupt. Many find that paying off their mortgages and loans is just too much.
However, there are many that also refinance their mortgage by working with the government. But how does one do so? What goes into refinancing your mortgage?
That’s what we’re here to look at today. Read on to find out more about how government refinance programs can help you in 2021.
Can Governments Help You Refinance?
The short answer is, yes the government can help you refinance your mortgage. They have various programs and laws in place to help individuals retain their homes and pay them off legally.
While many are turned down by banks for one reason or another, the government offers government home loan refinance programs to make sure you can pay off your home.
In fact, there are several types of government refinance programs. Let’s take a moment to break some of those programs down in the next section.
Types of Government Refinance Programs
You’ll most likely hear about three government programs to help pay mortgage payments. These are the Federal Housing Association, the United States Department of Agriculture, and the Veterans Association.
These loans are available for members of these respective department programs. Let’s look at what that means here:
FHA Refinance Loans
If you have FHA loans, you could be on the fast track towards refinancing them. These refinances don’t require home appraisals and have much less underwriting.
USDA Refinance Loans
Rural homeowners with USDA loans can refinance them through the USDA’s refinance program. A credit review or home appraisal is typically all you need to qualify for these refinances.
VA Refinance Loans
Service members, veterans, and eligible spouses can take advantage of VA’s interest rate reduction refinance loan. This lets homeowners find another loan with lower interest rates or even lower monthly payments.
What About HARP?
While those government programs are great for those currently affiliated with those departments, what about the other homeowners who aren’t? What happened to HARP from a few years ago?
The Home Affordable Refinance Program (HARP) was instituted after the Great Recession to help homeowners get their finances back on track. It’s been one of the leading mortgage relief programs in the U.S. since.
It’s for homeowners with a loan-to-value ratio of more than 80% and has very little equity. If you have a loan from Fannie Mae or Freddie Mac, you qualify for HARP.
In fact, the Fannie Mae High LTV Refinance Option (HIRO) and Freddie Mac Enhanced Relief Refinance Mortgage (FMERR) remain great refinance options in 2021. If you’re looking to refinance, they might be your best bet.
For homeowners without federal government loans, the aforementioned government refinance programs are for you. Click here for HARP loans if you want to find out more.
Leveraging Government Refinance Programs
If you’re starting to feel overwhelmed by your mortgage payments, it might be time to consider government refinance programs. Use this article to help you understand what they are and how they work.
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