2023 Mortgage Relief, Grant and Stimulus Programs
Are you a homeowner or aspiring to be one? If so, you’re in for a treat! There are some exciting developments in the world of homeowner grants, mortgage relief, and mortgage stimulus that you need to know about. These programs could potentially save you hundreds, if not thousands, of dollars each year. Let’s dive in and explore these opportunities in detail!
Enhanced Payment Deferral Policy
The Federal Housing Finance Agency (FHFA) has recently announced an enhancement to their payment deferral policy1. This new policy allows borrowers facing financial hardship to defer up to six months of mortgage payments. The deferred amounts are moved to the end of the loan as a non-interest bearing balance, meaning you won’t be charged extra interest for this relief. This is a fantastic opportunity for homeowners to maintain their current monthly mortgage payment while navigating financial difficulties. To take advantage of this, you should contact your mortgage servicer and discuss the possibility of deferring payments under this policy.
Biden-Harris Administration’s Mortgage Relief Initiative
The Biden-Harris Administration has also taken significant steps to make homeownership more affordable and attainable2. They’ve announced an action that will save homeowners with new FHA-insured mortgages an average of $800 per year. This is achieved by reducing the annual mortgage insurance premium by 0.30 percentage points, from 0.85% to 0.55% for most new borrowers. This action is expected to lower housing costs for an estimated 850,000 homebuyers and homeowners in 2023.
The mortgage insurance premium is the monthly fee that homeowners with FHA-insured mortgages pay to insure their mortgages, which they pay on top of their monthly principal and interest payments. By lowering this premium, the administration is making homeownership more attainable for low- and middle-income borrowers. If you’re considering an FHA-insured mortgage, this reduction could make a significant difference in your monthly payments.
Homeowner Assistance Fund
Moreover, the American Rescue Plan Act of 2021 established the Homeowner Assistance Fund (HAF)3. This fund is designed to help people struggling with their housing payments. Eligible homeowners can use the fund to catch up on past-due mortgage payments and other housing-related bills, such as homeowners insurance, property taxes, utilities, and even home repairs.
To apply for assistance from the HAF, you’ll need to contact your state’s housing agency. They can guide you through the application process and help you determine your eligibility.
Refinancing is another excellent way to lower your monthly payments4. Even if you can’t lower your mortgage rate, extending your loan’s term could reduce monthly payments. There are specific programs, like the government-backed Streamline Refinance, that can help borrowers refinance with little, no, or negative home equity.
For homeowners with FHA, VA, and USDA loans, the Streamline Refinance program is a fantastic option. This program allows homeowners to refinance even if their primary residence has negative equity. Plus, it requires less paperwork, typically has below-market mortgage interest rates, and cheaper closing costs. To apply for a Streamline Refinance, you’ll need to contact your current mortgage servicer or a participating lender.
CARES Act Provisions
The CARES Act, passed in 2020, also included mortgage assistance programs5. Some of these provisions have expired, but if you need help, check with your loan servicer about these programs. Options like loan forbearance, which temporarily pauses your monthly mortgage payments, or loan modification, which involves your loan servicer agreeing to lower your rate or extendyour loan term, can provide much-needed relief.
To take advantage of these provisions, you need to contact your loan servicer and explain your situation. They can guide you through the process and help you understand the options available to you. Remember, communication is key when dealing with financial hardship. The sooner you reach out to your servicer, the more options you’ll have.
In conclusion, there are numerous programs and initiatives aimed at providing homeowner grants, mortgage relief, and mortgage stimulus. These programs can make homeownership more affordable and attainable, especially for first-time homebuyers and those facing financial hardship.
So, whether you’re a current homeowner or aspiring to be one, these exciting opportunities could make a significant difference in your financial journey towards homeownership. It’s important to stay informed and take advantage of these programs when possible. Remember, owning a home is not just about having a place to live; it’s also a significant step towards financial stability and wealth creation.
- FHFA Enhances its Payment Deferral Option for Borrowers in COVID-19 Forbearance Plans ↩
- Biden-Harris Administration Announces Action to Save Homebuyers and Homeowners $800 Per Year ↩
- Homeowner Assistance Fund ↩
- Mortgage Relief Refinance Programs ↩
- CARES Act Mortgage Forbearance: What You Need to Know ↩