5 year Freeze on Teaser Rate Mortgages

In an effort to contain sub-prime mortgage defaults, the Bush Administration and financial institutions have agreed to a 5-year rate freeze on adjustable mortgages.

If you have an adjustable rate mortgage and qualify, your low initial rate will apply for 5 more years.

It looks like the lenders resisted the freeze and negotiated a lot of conditions.

To qualify for the freeze, you meet all these conditions:

1. It must be an adjustable rate mortgage that was originated between Jan. 1, 2005 and July 31,2007. 

2. It must be scheduled to reset between Jan. 1, 2008 and and July 31, 2010.

3. It must be your principal residence.

4. You must have less than 3% in equity.

5. You can't afford the new interest rate.

6. You are current with your payments, and are not in default.




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