The housing market has taken a dramatic drop recently, leaving many people facing foreclosure. President Obama refinance mortgage plan along with his administration has announced details regarding their new Home Affordability Stimulus Plan. It is in place to help 1 out of every 9 Americans facing foreclosure. The plan should make it possible for them to stay in their homes and getting refinanced easier even if the home they are paying on the mortgage is greater than the homes actual worth. This plan was introduced just 2 weeks after Obama announced $75 billion of the $787 billion stimulus plan will be used toward mortgage and housing problems.

This Housing Affordability plan had to be laid out carefully by the government so it would not seem as if they were rewarding irresponsibility or greed. Due to this the first step is to help those owners that have remained current with their mortgage payments for at least 12 consecutive months. However, there are other refinancing options that are offered regardless of your payment history. The stimulus plan is estimated help as many as 9 million homeowners in America and has to main components.

The first thing this plan will address is homeowners who have been able to remain current and up to date on their mortgage payments for at least 12 consecutive months. These homeowners will have the option to get their mortgage refinanced into a fixed rate 2% home loan. This will dramatically reduce their monthly payments, and save homeowners who are trapped in bad home loans or are having financial problems. This plan also allows the chance for a homeowner to get up to $1000 a year for 5 years, deducted from their principal as a bonus for paying your home loan on time.

Once this is done a owner can see their interest rate drop to as low as 2%, extending mortgage time frame or other options that will be able to reduce their payments to 31% of your total monthly income. The stimulus plan will also be limited to owners whose total loan is no more than $729,000 for a single family house. The incentives that the banks, lenders and other loan providers will also include up to $3500 when they participate with the new government plan. The banks and loan providers in some cases will also be matched dollar for dollar for the cost of refinancing or mortgage modification. In some cases the homeowners will receive up to $5,000 in federal money in order to help decrease or help pay off any other outstanding expenses to make absolute sure that they stay in their homes. Important notes given by Obamas administration is that homes that were purchased as second homes or as investments are not eligible to participate in the program.

Over all homeowners should look into the potential a home loan modification or refinancing could have for them. Odds are, especially using this housing bailout plan from President Obama, that the savings could easily equal hundreds of dollars per month for the remainder of the home loan. The savings easily add up to thousands of dollars. Do yourself a favor and call your mortgage lender or bank today and take advantage for yourself.

Learn more about Obama Mortgage Relief Plan Qualifications.