Mel Watt said the regulator is considering reducing the balances of some homeowners’ mortgages, but the effort could prove to be challenging.
Approximately one-third of borrowers are not sure of their interest rate and many could still save hundreds a month through refinancing.
The president’s proposed budget shows a slowdown in the fund over the next two years and a bump in HUD’s FY2016 budget.
Monthly prepayment rate is highest since February 2009 as lenders have been recovering greater gross percentages of unpaid balances through REO liquidations than through short sales.
With little to no down payment, no closing costs or fees and an interest rate that is near 0%, this program is starting to gain traction among borrowers. However, the approval process is far from easy.
The mortgage insurance premium cut starts today and HUD has issued a warning to lenders.