The Missouri Housing Development Commission has unveiled a new refinance program to help those facing foreclosure.
The Commission has allocated $3 Million for a special program that can help elegible homeowners refinance their homes. One program helps with closing costs … the other helps pay down principal if a home has negative equity.
"We said there were lots of people in the state that could benefit from this and we agreed on the dollar amount and they gave us permission to do it," he said.
Greg Spurgeon, single family home ownership administrator for the Commission, which comprises elected officials and governor’s appointees, says they met in July and approved the program.
"One program is designed for those who are having trouble making their payments," he said. "It’s a way for them to refinance — we have two options, the first is with assistance with closing costs. When you refinance your loan, there’s a cost that you incur, those can often add up and can get expensive and it’s something that could hinder your ability to refinance."
The second option is for those who owe more that the value of their home and therefore are unavailble to qualify for a refinance.
"We have a grant to help you pay down for some of your principle, up to $13,000, 3 percent for the closing costs and an additional $10,000 for the principal reduction through a grant."
The Commission says because the second mortgage is forgiven after five years of occupancy by the owner, it does not require monthly payments.
To qualify for the grant, the ratio of the amount owed as a percentage of the value of the home must exceed the maximum allowed by Federal Housing Agency guidelines. That percentage is 97.75.
Borrowers must receive face-to-face counseling from a U.S. Department of Housing and Urban Development-approved credit counseling agency, and only owner-occupied, single family properties are eligible.
The loans are made through a network of MHDC certified lenders.
For more, visit www.mhdc.com .
Jessica Machetta reports [Download/listen MP3]
