The news outlets have been abuzz since Fridays announcement by the president about a new program called FHASecure. So just what is this product that is supposed to save Americans from the sub-prime fiasco?
FHASecure is a new refinance option that is being offered to borrowers who have a good credit history and were making on-time payments before their adjustable-rate mortgages reset. The program has stringent underwriting guidelines and borrowers will have to pay a mortgage insurance premium, which are both safeguards for the borrower, lender, and taxpayers. More obvious benefits to the program include the FHAs trusted foreclosure prevention assistance and the absence of prepayment penalties.
According to a statement released by HUD, homeowners must meet the following five criteria to be eligible for FHASecure: