A new plan by the Obama administration is being designed to help some homeowners who are “underwater” on their mortgage – or they owe more money than the home is now worth.  The program will provide new loans backed by the Federal Housing Administration to qualified borrowers.  The qualified borrowers will not include homeowners living in multi-million dollar mansions or who have vacation homes, nor will it be available to investors, for example.  According to MSNBC.com,

To be eligible for the FHA refinancing program, borrowers who owe more than the value of their homes, known as being “under water,” must not have fallen behind on their existing mortgage payments.

In addition, the program will give lenders incentives for accepting a lower principal loan balance.  The plan will also lend a hand to the unemployed,

It also includes three to six months of temporary aid for borrowers who have lost their jobs. And there will be additional payments designed to give banks an incentive to reduce payments or eliminate second mortgages such as home equity loans — a problem that has blocked many loan modifications.

The second mortgages have truly been a road block for a lot of people, especially those who hope for a short-sale to avoid foreclosure.  Here’s hoping the plan really will help a portion of homeowners burdened with owing a bigger mortgage than their home is worth.

Have a great weekend!

House pictured is a HUD-owned house in middle Tennessee.