In conjunction with the government's new program called Making Home Affordable, lender Fannie Mae now offers the Desktop Underwriter (DU) Refi Plus Program. This home mortgage refinancing program hopes to prevent unnecessary foreclosures by lowering monthly mortgage payments for millions of eligible homeowners.

What It Means For You

Mortgage rates are now at a record low. Through refinancing, Americans can take advantage of these low rates and reduce their monthly payment. This will generate more monthly cash flow for millions of families across the nation; the government hopes this will spark spending and help to boost the economy. Another goal of the DU Refi Plus Program is to help at-risk homeowners stabilize their finances. This means that Fannie Mae and other lenders will now turn riskier loans, such as Adjustable-Rate Mortgages (ARM), into more stable loans, such as Fixed-Rate Mortgages (FRM).

Fewer Restrictions Than Before

The DU Refi Plus Program will ease the economic burden that millions of Americans face. One way to do this is simply by offering financial assistance to homeowners who were previously ineligible. Under the new DU Refi Plus Program, Fannie Mae reduces eligibility restrictions and requires fewer documents to apply.

• Previously, Fannie May required applicants to show two current pay stubs as income verification. Under the DU Refi Plus Program, applicants can show only one current pay stub.
• On certain loans, Fannie Mae will now waive appraisals.
• Previously, Fannie May would not handle loans over 80% of your home's market value. Now, applicants may have a loan-to-value (LTV) between 80-105%.
• Fannie May will now accept applicants with a credit score less than 580, if their LTV is 80% or less.

Program Terms and Conditions

Though Fannie Mae will now help more homeowners than ever before with DU Refi Plus, there are still certain restrictions that apply.

• Loans must be owned or guaranteed by Fannie Mae.
• Any existing subordinations must to be re-subordinated.
• Limited cash-out refinancing (less than 2% of loan, or $2,000).

You are ineligible for the DU Refi Plus Program if you have:

• Made a payment more than 30-days late within the past year.
• An Adjustable-Rate Mortgage with fixed terms less than 5 years.
• An interest-only mortgage.
• A balloon mortgage.
• A HomeStyle Renovation mortgage.
• A MyCommunityMortgage (MCM).
• A Texas 50(a)(6) mortgage.

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