What is a vhda loan

what is a vhda loan

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We have received many inquiries from our customers who received conventional VHDA loans now seeking to refinance to a lower rate.

VHDA conventional loans offered many benefits to our borrowers when they purchased their home. Our programs offered features such as 100% financing with no mortgage insurance. This provided lower rates and more affordable financing allowing first time homebuyers to purchase homes with less cash at closing and with lower monthly payments. To achieve these benefits, VHDA utilized loan funding sources other than those sponsored by the federal government such as Fannie Mae and Freddie Mac.

Special federal refinancing

programs (such as HARP) only apply to loans funded through those federal sources and, unfortunately, VHDA does not currently have a funding source available to assist its borrowers with conventional mortgage loans who owe more on their loans than their homes are worth (underwater).

Accordingly, such borrowers seeking to refinance at a lower rate would need to obtain traditional refinancing from private lenders offering refinance programs. However, these new loans would be based on the current value of your home. Therefore, if you owe more on your loan than the current value of your home, you would be required to make up the difference with your own funds.

It should be noted, however, many borrowers seeking to refinance at a lower rate may find that the addition of mortgage insurance may not result in a significant reduction in their monthly payment.

We regret that other refinancing options are not available however the historical economic impacts on our industry were impossible to anticipate.

    December 27 2012

Source: www.zillow.com

Category: Credit

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