With tales of woe weeping from the mortgage industry right now - including the ongoing disaster saga going on at American Home Mortgage - New York wants to help those in danger of foreclosing.
The State of New York Mortgage Agency said it has joined forces with lender Fannie Mae to offer people a chance to refinance their home mortgages.
The project, called the “Keep the Dream” refinancing program, was created for people with adjustable-rate mortgages or interest-only mortgages whose loans will soon reset.
Through the program, borrowers who show they’ve had trouble paying their mortgages can refinance their home loans, up to $417,000 or 100 percent the property value, into a new 30-year or 40-year fixed-rate loan.
But Long Island borrowers must make no more than 165 percent of the median income.
From the Inman News story:
The program is targeted at low-, moderate- and middle-income homeowners. Eligible borrowers can have incomes of up to 165 percent of median income in New York City, Long Island and the counties of Dutchess, Orange, Ulster, Westchester, Rockland and Putnam, and up to 125 percent of median income for the remainder of the state.
Fannie Mae will issue mortgage-backed securities (MBS) that will be secured by these mortgages, and the company’s $100 million contribution to the program is “an important part of the solution to the subprime problem,” New York officials said in a press release.
The program requires eligible borrowers to complete a homeowner education course with a federally approved, not-for-profit organization. Borrowers must also agree to participate in early delinquency intervention counseling should they become delinquent for 30 days or more on their refinanced mortgage.
The New York State Division of Housing and Community Renewal (DHCR) will dedicate nearly $400,000 in Urban Homeownership Assistance Program grants to fund counseling through eight nonprofit agencies located in cities with more than 60,000 residents.
