New American Funding Adds Refi Option For Low-Income Borrowers

New American Funding is presenting the ability to refinance for low-income borrowers, with help from a new program from Freddie Mac.

Freddie Mac and Fannie Mae adopted a new refinance option for loans to borrowers with incomes at or below 80% of area median income and you may be eligible to take advantage of this program, according to New American Funding. If a borrower's mortgage is owned or guaranteed by either Freddie Mac or Fannie Mae, they may be eligible to refinance under this refinance option.

The company is now offering Freddie Mac's Refi PossibleSM program. The program requires that eligible borrowers receive a savings of at least $50 on their monthly mortgage payment and a reduction of their interest rate of at least 0.50%.

Homeowners are also eligible to receive $500 credit for towards an appraisal if one is obtained.

Qualifications include:

• Having an owner-occupied 1-unit single-family mortgage that is backed by Freddie Mac or Fannie Mae.
• Having an income at or below 80% of the area median income.
• Having a mortgage that was originated at least 12 months ago.
• Not missing a mortgage payment in the last six months; having not missed more than one payment in the last 12 months.
• Having a mortgage with a loan-to-value ratio that does not exceed 97%, a debt-to-income ratio that does not exceed 65%, and a credit score as low as 620.

The program is for fixed-rate loans only, offers and features loan limits up to the conforming limits.