Fannie Mae and Freddie Mac Introduce Refinance Programs for Underwater Properties

If you’re making timely mortgage payments, but have been unable to refinance because your property is underwater, you might qualify for a special refinancing program.

By , Attorney

Usually, refinancing is available only if you have equity in your home. But if you have a Fannie Mae or Freddie Mac loan, you might qualify for a refinance even if you're underwater on your mortgage. These government-sponsored enterprises (GSEs) have implemented new refinance programs for borrowers with high loan-to-value (LTV) ratios: Fannie Mae offers the "High Loan-to-Value Refinance Option," and Freddie Mac offers an "Enhanced Relief Refinance."

To qualify for a refinance under either of these programs, you must have an existing Fannie Mae or Freddie Mac loan and meet other eligibility criteria, like having no more than one 30-day delinquency in the past 12 months. To find out more about eligibility requirements, call your loan servicer or go to Fannie Mae's High LTV Refinance Option website or Freddie Mac's Enhanced Relief Refinance Mortgage website.

Effective date: January 1, 2019