HAMP homeowners to see their monthly payments rise
The almost 783,000 homeowners who had their monthly mortgage payments reduced over the last few years under the Home Affordable Modification Program will now have to contend with their rates moving back up, according to CNN Money. With almost one-third of the borrowers who had their rates adjusted having already defaulted, real estate experts are concerned that the rising rates could cause even more homeowners to be unable to pay back their loans.
HAMP was launched in 2009, and reduced struggling homeowners' mortgage interest rates - some to as low as 2 percent, according to the news source. The adjustments were always designed to last five years, and at the time, this was expected to be enough time for the effects of the recession to be behind the U.S. Unfortunately, many of the borrowers who were struggling five years ago are not in a better position now.
Obama officials are defending the program, suggesting that it had a serious impact on the number of total foreclosures that we will see, according to The Washington Post. However, they have said that they are prepared to act if there is a significant uptick in repossessions as a result of the rising monthly payments.
Real Estate News brought to you by 2M Realty, a true expert in the online real estate market.