Earlier this month the Urban
Institute pointed out that the unprecedented low interest rates of the pandemic
era have not benefitted everyone. Their research showed that tightening credit
access has meant that low income
homeowners, and those with high loan to value (LTV) ratios or low credit scores
have largely been left out of the rush to refinance. The Federal Housing
Finance Agency (FHFA) has now announced a new refinancing option to address that
situation. FHFA says it has directed the GSEs Fannie
Mae and Freddie Mac to implement an initiative to encourage eligible
low-income borrowers to refinance and lower both their interest rates and their
monthly mortgage payments. It estimates that
borrowers who take advantage of this opportunity could save between $100 and
$250 a month.

 

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