A new federal program is hoping to help homeowners make the most of historically low interest rates. According to CNBC, eligible borrowers will be able to refinance their mortgage at a reduced interest rate and lower monthly payment as soon as this summer.
Estimated savings are anticipated to be between $100-250 a month, according to the Federal Housing Finance Agency.
In order to meet the criteria for the new program, homeowners must have a mortgage backed by Fannie Mae or Freddie Mac, and must live in the home that has the mortgage, while earning income that is at our below 80 percent of the median income in their area. Additionally, perspective applicants must have a solid record of making past mortgage payments, with no missing payments for the past six months and no more than one missed payment for the last 12 months.
CNBC notes that the mortgage can’t have a loan-to-value ratio above 97 percent, and they must have a debt-to-income ratio below 65 percent or a FICO credit score of at least 620.
More info on the program can be found here.