In the Spotlight
August 17, 2017
Your clients can potentially save hundreds per month – and even thousands – over their mortgage loan's lifetime.
You didn't know that was possible? It is. Keep reading.
Solution to Lower Mortgage Payments
Your Client Wants Lower Mortgage Payments
Your homebuying clients are mortgage-shopping, but they're unsure which option to select. So they call you for advice and ask if you know of any loan options where the monthly payments would go down at some point because they'd like to take that extra money and add it to their savings.
Turns out you DO know of a solution – one that allows your clients to cancel their mortgage insurance (MI), reducing their monthly payments – and potentially saving hundreds of dollars a month. These savings can add up to thousands over the lifetime of the mortgage!
What's the mortgage solution? It' Home Possible®, a conventional low down payment mortgage offered by Freddie Mac's national network of lenders. In addition to cancellable MI, Home Possible has other built-in affordability features that make it attractive to other clients, too – including first-time buyers, those of modest means, and even those who are upsizing or downsizing.
So how does it work? When your client buys a home with a Home Possible mortgage and the down payment is less than 20 percent, part of the monthly payment will include MI. When the home's equity of 20 percent is reached, your client contacts their lender, informs them of the milestone and requests that the mortgage insurance be cancelled. After completing a review, what happens next? The lender lowers your client's mortgage payments.
What about FHA loans? Can mortgage insurance be cancelled? No. Homebuyers must pay mortgage insurance premiums throughout their entire mortgage term – even if their equity in the home reaches 20 percent or more.
As an informed real estate agent who takes your role as a trusted advisor very seriously – you've done your homework and can help educate your clients who may not be aware of mortgage options that may better fit their needs.
A Tip for Your Client
Home Possible allows you to cancel your mortgage insurance – saving potentially hundreds on your monthly payments.
What do you get for sharing your knowledge?
- Appreciative clients who are better educated about their mortgage options – including Home Possible -- that may be available to them through your lender network.
- More referrals of family and friends from your appreciative clients.
- More sales.
Win. Win. Win.
Watch, Learn and Share
Watch and share this video of Patricia Claproth, an affordable lending manager at Freddie Mac, who explains that clients who obtain a Home Possible conventional mortgage can cancel their mortgage insurance when they achieve 20 percent equity in their home – versus FHA which requires mortgage insurance throughout the life of their loan. Share with your clients and lender network.
- Home Possible Mortgages fact sheet
- Quick Home Possible online tutorial
- Free Home Possible training/networking events
- Freddie Mac Real Estate Professionals Resource Center