Yesterday some asked me “what can homeowners do if their home is worth less than they owe on the mortgage?” Until yesterday a homeowner in that situation was “upside down” and there were not any real viable solutions.

That suddenly changes at the end of October!

A new federal program allows borrowers who are  ” upside down ”  on the homes to refinance up  to 125% of current value, as long as I get an underwriting  approved and their loan is owned by FHLMC  (Freddie Mac ).  I have included the Freddie Mac Factsheet the better explains the program for those of you who might be interested.

Freddie Mac Fact Sheet

A big question is how you find out if a mortgage is owned by Freddie Mac and  I’ve located Freddie Mac’s web link where you can type in the borrower’s information and see is Freddie Mac owns the loan.

Mortgage Loans Owned by Freddie Mac

If the loan is owned be Freddie Mac, the next step is  to get a feeling of how much the home is worth. Many people are familiar with  Zillow.com.   Recently they have developed a link at their site that will tell you about market trends for just about anywhere in the country.  Once you get into the site you can locate your State and then the metro areas and even neighborhoods!  Take a moment to get familiar with the data at Zillow.com.   I like that is gives you a five year graph of market values and to the bottom of the page you can see a list of cities with current average homes values and historical trends.

I have some other sources that better calculate home values, so as long as the numbers are close, it is worth checking out. If you have a friend that is underwater and deserves a solution, forward them this email and have them contact me. I am here to help.