State to help troubled homeowners; Program would provide $250M for refinancing.Byline: John J. Monahan
BOSTON - Hoping to fend off Verb 1. fend off - prevent the occurrence of; prevent from happening; "Let's avoid a confrontation"; "head off a confrontation"; "avert a strike"
deflect, forefend, forfend, head off, avert, stave off, ward off, avoid, debar, obviate what he called a nightmare facing many homeowners caught up in the subprime mortgage crisis, the governor yesterday announced a new state-backed program aimed at saving up to 1,000 homeowners from foreclosure foreclosure
Legal proceeding by which a borrower's rights to a mortgaged property may be extinguished if the borrower fails to live up to the obligations agreed to in the loan contract. and helping them to refinance Refinance
1. When a business or person revises their payment schedule for repaying debt.
2. Replacing an older loan with a new loan offering better terms.
When a business refinances they typically extend the maturity date. at lower interest rates.
Tina Brooks Harold Floyd (Tina) Brooks (June 7, 1932–August 13, 1974), was an American hard bop tenor saxophonist.
He is best known for his work for Blue Note Records, for whom he recorded four sessions as leader between 1958 and 1961, and for whom he also recorded as a sideman , state undersecretary for housing, said the program will involve no taxpayer obligations, but will use $60 million in state housing bond funds in combination with $190 million from the Fannie Mae Fannie Mae: see Federal National Mortgage Association. mortgage company to refinance home mortgages.
"Our target audience are borrowers who have gotten themselves into subprime or predatory mortgage loans," and are having trouble making mortgage payments, she said. In many cases, she said, those finding themselves unable to afford escalating mortgage payments are homeowners who took out loans for amounts significantly higher than the value of their homes and otherwise would find it impossible to refinance.
Gov. Deval L. Patrick said the program will "help out those folks who are stuck in a high interest, overbearing o·ver·bear·ing
1. Domineering in manner; arrogant: an overbearing person. See Synonyms at dictatorial.
2. Overwhelming in power or significance; predominant. loan on unfriendly terms and facing imminent foreclosure." Using the state bonds to leverage Fannie Mae funds, he said, the state will "try to make that benefit as broadly available as possible."
"Too many of our residents were put into loans they couldn't afford," the governor said. "This innovative mortgage loan program will give some of our most vulnerable citizens at least a fighting chance one dependent upon the issue of a struggle.
See also: Fighting to keep their homes."
Ms. Brooks said the state bonds and Fannie Mae funds used for refinancing Refinancing
An extension and/or increase in amount of existing debt. would be repaid through the new mortgages.
The program will be run through a national nonprofit A corporation or an association that conducts business for the benefit of the general public without shareholders and without a profit motive.
Nonprofits are also called not-for-profit corporations. Nonprofit corporations are created according to state law. group, NeighborWorks, which has a network of community-based organizations it works with to help homeowners, including Worcester Community Housing Services and NeighborWorks of Worcester.
Those interested can contact the organization at (888) 995-HOPE. They will be referred to a local non-profit group, which will provide financial counseling on how to work with their lender to stay in their home despite falling behind on payments.
If qualified, participants would be able to get 40-year fixed-interest-rate refinancing mortgages with 7-7/8 percent interest rates, at the start of the program.
Ms. Brooks said many with predatory or subprime mortgages are paying 10 to 12 percent interest. She said the refinanced mortgage will mean lower, more stable monthly payments.
She said those holding the initial mortgages will likely have to accept less than 100 percent payment for their mortgages, possibly 90 percent, she said. She said they can reject the offer, but with the foreclosure costs they would face, the reduced settlement may be the best offer they will get for a mortgage in trouble.
Ms. Brooks said the program will offer refinancing to homeowners who are 60 days delinquent on their mortgage payments, if the delinquency stems from the resetting of interest rates on their mortgage. Also, she said they can have credit scores as low as 560. She said most lenders will not approve a mortgage with a credit score below 630.