Cape Coral Florida's Real Estate Guide

Real estate values are falling too fast causing homeowners to owe more on their homes than they are worth. To try and help struggling home owners, the Obama administration has enacted a plan to give mortgage lenders incentives for refinancing homeowners' loans. The goal is to have the lender reduce homeowners' monthly mortgage payments to no more than 38% of their income. The government will then step in and match funds to get the mortgage payment down to 31% of the homeowners income, making their mortgage affordable for the long haul. Sounds good, so what's the catch?

Unfortunately, the government isn't offering mortgage lenders enough of an incentive to participate in this program. Only $6,000 per refinanced loan is being given and banks stand to lose a lot more than that on many of these loans. Some critics feel that not enough mortgage lenders will participate in this program, rendering it ineffective overall. Supporters, such as FDIC Chairman Shelia Bair, feel that it will work because lenders will participate but it is going to take time. She anticipates that there is going to be a flood of borrowers contacting their lenders so people should be patient when attempting to modify their mortgages.

Millions of people stand to be helped from this plan but the truth is that millions of people will still lose their homes. Why? Because they simply cannot afford to be homeowners. Some people entered into the real estate market before they were ready and they may not be able to helped by this plan. If you are a homeowner who is currently behind on your mortgage, contact your mortgage lender today to see what can be done to help you avoid foreclosure and keep your home.