Not all that shines is Gold

I'm learning and reading about the new Freddie and Fannie programs and the biggest problem that I see with them is that they don't help the people that need help the most.

If your loan is currently owned or backed by Freddie or Fannie, refinancing could be very easy. But if you where someone who got a subprime or alt-A loan you probably aren't backed by either of these two companies. So for all the people who have ARMs coming up or where on 2 - 5 year subprime / alt-a loans, you can't capitalize on these great programs with great rates.

For instance I got a 5 year ARM. It is now coming to the adjustable period. Out of easy 5 years ago I went through a subprime lender for less documentation. I do not qualify for either of these lender's new programs because who knows who backs my loan. I'm probably one of a million good, always have made my payment, borrowers that would love to get a lower interest rate and a long term 30 year fixed loan. I can't for right now. maybe they'll change the guidelines but not tomorrow they aren't.

As I predicted there are going to be some good things that come out with these programs but there are also some drawbacks. It's going to be a long process to help so many people out. I suspect a lot of changes in the coming months.

Also, this is another sign that things are not going to get better anytime soon. A few good pieces of news last week and people are ready to proclaim the bottom is near. Not so fast my friends. We may be plateauing before another shoe drops.

New Programs - UPDATE

I've been very busy trying to keep up with all the lenders and all their changes. They're starting to slowly but surely roll out the changes. I've got only one or two lenders that have pricing but almost all of them have been rolling out the guidelines. By next week I hope all the lenders will be set.

As I feared there are some hits that may take away the usefulness of the new programs but I still think that there is a lot of good that's going to come out of these programs.

Please make sure you contact your local congress person and senate person AND president to encourage them to get rid of this appraisal change that coming in May. It's going to be a disaster for you the consumer and for everyone involved in the loan process. Here is a link to find your representative http://www.usa.gov/Contact/Elected.shtml

Thanks.