Government makes changes to help underwater owners

Although of little consolation to homeowners whose loans were not sold to Fannie Mae and Freddie Mac, there may be some much needed help for those who were.

In an attempt to assist more distressed homeowners changes have been made to the provisions of the Home Affordable Refinance program. If your loan was sold to Fannie or Freddie before May 31, 2009, the debt ceiling of 125 percent of loan to value is being removed. That means that, even if the loan exceeds 125 percent of the home's fair market value, you may be able to refinance. The program is being extended to Dec. 21, 2013, which will provide more time to navigate what has been a long process for those who have applied.

With home loan interest rates still at 3.75 percent theses changes are intended to help more people lower their payments by refinancing their homes at the lower rates, even though their home may currently be worth less than what is owed. Under the changes a current property appraisal may not be necessary.

If you are interested in applying, you must be current on your loan payments and may not have been late on more than one payment over the last 12 months and no late payments in the last six. You will still need to fill out a loan application and go through underwriting and pay the fees associated with those processes. To find out if your loan is owned by Fannie Mae you can go to: FannieMae.com or to FreddieMac.com to see if Freddie owns your loan. Just look for their "loan lookup tools." By entering your address you can quickly find out if you may be eligible for HARP.

For small business owners there is help available too. We wrote here earlier this year that the Idaho Housing and Financing Association would be offering funds through the "Collateral Support Program" or CSP. IHFA is now accepting applications for the $13.2 million allotted by the Small Business Jobs Act. According to IHFA; "This funding will help Idaho's lenders address a key impediment to small business lending - a decline in asset values."

The loans can be used to cover a wide variety of purposes, such as start up costs, working capital, business acquisitions and expansions, or construction, among others. Any small business owner employing 500 or less people and authorized to conduct business in Idaho may qualify for the program.

Small businesses interested in the CSP should contact their current lending institution and ask about the program. If a lender is a CSP participant, it will apply to IHFA for a collateral support deposit on behalf of the small business. The CSP is offered on a first-come first-served basis to qualified Idaho small business borrowers. Loans must generally first meet a lender's credit underwriting criteria with the exception of a loan collateral adequacy, which is what the program covers.

IHFA intends that these funds will multiply themselves as they enter the state's economy; "When the loan is paid back, the funds will come back to IHFA and would be reinvested in new small business loans. This $13.2 million allocation for Idaho is expected to support more than $130 million in new private lending in the state over the next five years."

Check with your bank or visit www.ihfa.org for a list of qualified lenders.

Trust an expert... call a Realtor. Call your Realtor or visit www.cdarealtors.com to search properties on the Multiple Listing Service or to find a Realtor member who will represent your best interests.

Kim Cooper is a real estate broker and the spokesman for the Coeur d'Alene Association of Realtors. Kim and the association invite your feedback and input for this column. You may contact them by writing to the Coeur d'Alene Association of Realtors, 409 W. Neider, Coeur d'Alene, ID 83815 or by calling (208) 667-0664.