Sunday, August 5, 2012

Refinance Program For Home Owners

I've been an OFW for 5 years now and one of the most common investment for those people working abroad is getting a house and lot.  I've heard a lot of stories from friends and relatives about the success and failure of getting a home for themselves.  Some were able to obtain one by buying the property in cold cash through their savings and some acquired their properties by going through a financing institution. However, I observed that more than 50 per cent of overseas workers obtained their properties through financing institutions like the Mutual Home Development Fund and Social Security System,  while others apply directly to the real estate developers who offer different kinds of payment scheme.  As for my case, I choose to acquire my properties by using my savings as I wanted to avoid complications in case that I failed to pay my monthly amortizations.  Some financing institutions will foreclose your properties if you failed to remit your monthly amortization for 3 consecutive months.   Besides, if I use up my saving to purchase a lot or a house and lot, I could save on the interests that most financing institutions would charge for obtaining such loan.   

A lot of stories can be told about employees who neglect on their responsibilities to remit their monthly amortization as some lose their jobs in the midst of the payment period  and some were simply lured into over spending and had been delinquent payers.  For some, they took the risk of their properties being foreclosed and lose their investments while others opted to save their investment by refinancing their home loans.  There are lots of refinancing institutions available but many owners failed to qualify for the traditional refinance options and ended up paying interests more than what they can afford.

Good thing that there are some refinancing institutions that offer an affordable program to help the home owners qualify for a refinance and save money on their mortgage payments.  An example of which is the HARP refinance savings that could assist millions of struggling home owners by providing them the opportunity to refinance their loans.  This was made possible by allowing more flexibility in the qualifying requirements for borrowers.  

I personally think that such program will help home owners stay in their homes.  More often, it would be ideal for home owners to take a responsible stand in keeping their commitments to avoid losing their investments.  However, if you are confronted with the situation, acting responsibly by looking for alternative solutions would be a worthwhile decision.  Being aware of such programs  and keeping yourselves informed of available options will put you in a more advantageous position.   

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