That’s tough about not lowering the loan value and you probably won’t qualify for help after trying to jump through all the hoops because this settlement only sets aside a small amount of money for helping underwater homeowners.
At least interest rates are at historic lows, this helps when refinancing. Make sure you cover all the bases of possible avenues of refi but avoid paperwork that signs your life away on missed payments. IRS might want their cut on a downward loan adjustment as they look at it as you making money on the deal but things are changing so quickly it is hard to keep up. I’m sure the banks enjoy the confusion.
Actually, mine is a VA Streamline so it’s a done deal. I set up new escrows but get my current escrows refunded. Bottom line is it cost nothing and my interest goes from 5.25 to 4.125 saving me almost $200 a month.
There is no appraisal but it wouldn’t matter anyway. No government loans, Fannie, Freddie, FHA or VA, are included in this wonderful “deal” they cut. Ain’t that a kick. A guy under water on a “B” paper loan gets his principle cut but the guy next door with an under water FHA loan doesn’t get his cut.
I think this deal is for investor friends of the politians only. And I’m sure the five banks are going to make some heavy obama contributions.