Monday, July 2, 2012

HARP 3.0 reducing the monthly mortgage payment

Since I am on a fixed income due to medical disability and rely on Social Security Disability and VA compensation, I have to watch where I spend the dollars and pennies. Like most Americans the home we bought in 2006 at the height of the market has since lost value, not as bad as some areas like Las Vegas or Southern California where the values have dropped as much as 50%.

But our home is underwater and we checked into the HARP program thru our bank who handles the mortgage, like most banks our mortgage was sold to Freddie Mac.  Last week the mortgage department of our bank called and is ready to process the HARP paperwork, it seems to have been done with a few phone calls for information, they e mailed my wife the estimates of the new data to see if this is what she wanted to do.

It will  reduce our interest rate from 6.5% to 4.25 amd our payments from 1200 a month to 870.00, now  that is a pay raise we can appreciate. It seems as if everyone else has not heard of the recession, SCE&G has filed for nearly a 7% increase in electric rates, I have never received a 7% increase in income.

So while I may be able to "save" some major money on the mortgage, other people seem to be determined to get it back in some other form, the sad part of it is, even if I  was not able to utilize the HARP program, corporations like SCE&G will still be seeking  large rate increases.

What makes me shake my head over the reasoning for the rate increase is that they seem to be shocked to learn they have thousands of miles of lines, poles and substations etc, that need maintenance, replacement etc, this is 2012, they have been putting this equipment in the ground for decades, and they just now realize it cost money to repair or replace these items, I would have assumed these costs would have been built into the rates long before this. Why go for 7% all at once, why couldn't this have been  phased in over years at one half percent or one percent a year, this proposal is harmful to the elderly and disabled, some people will either have to turn off the air conditioners or  start buying more Ramen noodles so they can keep the lights on.

I am grateful to President Obama and his team  that have made HARP available to my family and  millions of others that need  the ability to refinance  underwater mortgages, that would not normally be able to. This will also help to stabilize the national housing market which benefits us all.

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