President Obama unveiled a new mortgage plan last week, aimed at reducing monthly mortgage payments for distressed homeowners who owe more than their properties are worth (more than 125 percent of the value of their home). He announced steps for these homeowners to refinance their loans at low rates (around 4 percent).
Is this plan going to help distressed Denver homeowners? Not necessarily. One million borrowers may qualify across the county, but this is only 10 percent of people who need help. Why? The program is limited to those who owe more than 25 percent above the current value of their homes and there are many other obstacles, inlcluding qualification barriers and high upfront costs.
According to a recent Denver Post article, the program will have limited impact in Colorado since it hasn’t experienced a severe real estate downturn. Thankfully, it’s hard to find Colorado homeowners who owe more than 125 percent of the value of their homes. The program will have a stronger impact on states like California, Arizona and Florida, where home values have fallen dramatically over the past few years.
Despite this, nearly 21 percent of mortgages in Colorado are under water, or worth less than the amount owed, so while this new program may not be the answer, there are many other options.
TeamCox Realtors - Denver real estate specialists – is a Certified Distressed Property Expert, or CDPE. We are trained to help distressed Denver homeowners explore all of their options to avoid foreclosure, including short sales, loan modifications and much more. If you are having trouble with your mortgage, or owe more than your home is worth, please contact us at 303-400-6060.
If you are looking for a home in Denver and the surrounding area then contact TeamCox for professional Real Estate Assistance