Oppenheim Reviews Obama’s FHA Short Refinance Program and What it Means to Florida Homeowners
Fort Lauderdale, Florida – September 11, 2010 – First loan modifications, then short sales…now it’s the short refi. Officially known as FHA Short Refinance Program, it’s the latest band-aid in Obama’s bailout plans aimed at resuscitating Florida’s underwater homeowner facing foreclosure.
Introduced this week, the FHA Short Refinance Plan offers aid to people who owe more than their mortgage is worth. Will it bring life back to the real estate market and stimulate the economy? This is the question market analysts and legal bloggers like Florida Attorney Roy Oppenheim are debating.
One of the biggest dangers facing the housing market is the glut of underwater homeowners who could default if their financial situations or home prices worsen. About 11 million borrowers, or 23% of households with a mortgage, were underwater as of June 30, according to CoreLogic Inc. That number is expected to double next year.
“This is a much needed program, but just might be a case of too little, too late,” says Oppenheim who continues to help Florida homeowners navigate through the tides of the real estate market. “Servicers will not be highly motivated and sometimes inclined to steer towards foreclosure.” In addition the program, at best, is designed to help about four million homeowners according to the U.S. Housing and Urban Development (HUD) Website.
The FHA Short Refinance option is targeted to help people who owe more on their mortgage than their home is worth—also known as being ‘underwater’—because select local markets saw large declines in home values. Unlike the first two waves of bailouts, the short refinance program is aimed at homeowners who are NOT currently behind on their mortgages.