The following is a portion of an article published by DSNews today, March 3rd, 2011, regarding the short refi program.
“As the House prepares to debate on the future of the Federal Housing Administration’s Short Refinance option, FHA Commissioner David Stevens implored House subcommittee members to give the program a chance.
The program is a voluntary option for lenders to agree to offer principal write downs and restructure loans for underwater borrowers.
With an estimated one-fourth of outstanding mortgages classified as underwater, Stevens says keeping the program alive is crucial to spurring economic recovery by helping to prevent more foreclosures.
“In many cases, providing a principal write down to a borrower is more economically rational for an investor or lender than not doing so,” he said, “as lenders lose significant value when a home goes to foreclosure.”
The program allows investors and lenders to reduce their expected losses while also enabling responsible borrowers to afford to stay in their home.
Stevens said as of February 11, 23 FHA-approved lenders are participating in the program and 245 FHA case numbers have been requested, of which 44 loans have been endorsed.”
For more information regarding this and other information on Short Sales, contact Showcase Realty, LLC