The white house is taking steps to limit refinancing measures, through which homeowners have the opportunity to get cash.
According to the decision of the Federal Housing Administration (FHA), which is a division of the Ministry of housing and urban development and provides loans mainly to those who first acquires property from September the refinance would be possible if the size of the loan is 85%, as previously, and 80% of the cost of purchased object. Similar action plans and the company Ginnie Mae, a division of the Ministry.
On such measures the government took, drawing attention to the fact that over the past few years, the amount of money obtained in this way on hand, has sharply increased, and the stability of the state program of mortgage lending, which amounts to $ 1.3 trillion, was thereby threatened. In addition, the refinancing, if it is not needed, can lead to increased costs of borrowers and limits in the eyes of investors the attractiveness of securities issued by secured mortgages.
Now borrowers prefer to borrow money not as active as it was before the financial crisis. Nevertheless, only through FHA for 12 months as of September last year, was carried almost 151 thousand refinansirovany, whereas 5 years ago this figure was only 43 thousand.
Such action is beneficial while real estate is expensive, including at the expense of the repair. But do not forget that many of those who bought housing before the recession, the result was still owe more than their home is worth. To avoid this, companies Fannie Mae and Freddie Mac also found that the refinancing amount cannot exceed 80% of the cost of housing.
But the FHA program is more risky, because the Agency not only insures mortgage, but also covers the losses in case of fraud. And Ginnie Mae, among other things, provides loans through the Department of veterans Affairs, which creates additional complexity. And now the company plans to separate these loans from the General mass, to make securities issued under the collateral more attractive to investors. However, such changes will take effect only from Nov.