NEW YORK – December 13, 2007 – The State of New York Mortgage Agency (SONYMA) is taking several steps to make its “Keep the Dream” mortgage refinancing program more widely available to New York State homeowners at risk of losing their home.
Following discussions with its partners in the public and private sector, SONYMA has:
- Expanded eligibility to include owners of two-, three- and four-family homes in addition to single-family homes, condos and co-ops;
- Expanded eligibility to allow lower FICO credit scores;
- Increased the number of participating lenders by adding CitiMortgage Inc., Countrywide Home Loans Inc. and JPMorgan Chase to the program’s lending network; and
- Initiated a direct mail campaign to potential borrowers.
“Helping New York families keep their homes is one of our top priorities,” said Priscilla Almodovar, President and Chief Executive Officer of SONYMA. “That’s why SONYMA, with the cooperation of our partners, is aggressively reaching out to homeowners at risk of defaulting on their mortgages to let them know about the benefits of our Keep the Dream refinancing program.”
Keep the Dream, which was announced by Governor Spitzer in July, offers a refinancing alternative to New York homeowners with risky mortgages to help them avoid default and foreclosure. Borrowers with adjustable rate, interest-only or other non-conventional mortgages can refinance with SONYMA and obtain a 30-year or 40-year fixed-rate mortgage at competitive interest rates.
To be eligible, borrowers must demonstrate that they have faced or will face a mortgage payment hardship where the rate and/or payment has increased or will increase in the future. Borrowers who are up to 60 days delinquent on their mortgage payments because of the higher interest rate and/or payment are eligible.
Since SONYMA began taking reservations for Keep the Dream in September, it has worked with M&T Bank, the program’s master servicer, Fannie Mae, and mortgage insurance companies to expand eligibility.
Two-to-four Family Homes
As a result of these discussions, SONYMA added owners of two-to-four family homes to the program. This change is particularly helpful to New York City residents since many city homeowners with risky mortgages own multifamily dwellings.
The maximum mortgage loan for the program is higher for a multifamily home than the single-family mortgage cap of $417,000. The maximum mortgage for a two-family home is $533,850 (with 97% financing). For a three- and four-family homes, the maximum is $645,300 (with 95% financing). Single-family homes, condominiums, and cooperatives are eligible for 100% financing.
Minimum FICO Scores
SONYMA received a great deal of feedback from counselors and lenders who said that Keep the Dream’s minimum FICO credit scores should be lower to help borrowers who are already experiencing financial hardship. In response, SONYMA worked with its partners to lower the minimum—which will help more homeowners qualify for Keep the Dream refinancing.
Lowering the minimum will enable more borrowers who are considered subprime—those with FICO credit scores at or below 620—to be eligible for Keep the Dream. Under the new requirements, the minimum FICO scores will be 575 for single-family homes, condominiums, and cooperatives (with 100% financing), 580 for two-family homes (with 97% financing) and 620 for three- and four-family homes (with 95% financing). Previously, the minimum FICO scores were 620 for single-family homes (with 100% financing), 620 for two-family homes (with 97% financing), 620 for three- and four-family homes (with 95% financing), and 660 for cooperatives (with 100% financing).
Participating Lenders
SONYMA is continually working with M&T Bank and its network of participating lenders to increase the number of lenders offering Keep the Dream refinancing. SONYMA is proud that three of New York’s largest lenders, CitiMortgage, a member of Citigroup; Countrywide Home Loans Inc., and JPMorgan Chase have agreed to join the Keep the Dream lender network. Countrywide will offer mortgages to homeowners throughout the State while CitiMortgage and JPMorgan Chase will offer mortgages in the New York City area.
In addition to CitiMortgage and Countrywide, six other lenders are participating in the Keep the Dream program: M&T Bank, Astoria Federal Savings and Loan Association, Continental Home Loans Inc., Walden Federal Savings and Loan Association, Home Funding Finders Inc. and Nothnagle Home Securities Corp.
Increased Marketing Efforts
In addition to standard marketing practices such as print and radio advertising, SONYMA is actively reaching out to mortgage servicers to market directly to New York State customers who may be eligible for Keep the Dream. Servicers such as EMC Mortgage Corporation, a subsidiary of Bear Stearns, have agreed to send a mailing to more than 1,000 clients to inform them about the Keep the Dream program and how they can apply. SONYMA continues to reach out to servicers in an effort to conduct similar outreach to at-risk borrowers.
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Homeowners interested in more information about Keep the Dream can call SONYMA toll free at 1-800-382-HOME (4663) or visit the SONYMA website: http://www.nyhomes.org/.
SONYMA was created in 1970 with the mission of helping low- and moderate- income families become homeowners. It offers a variety of low down payment mortgages that provide below-market fixed interest rates, as well as closing cost assistance through a network of participating lenders across the state.
Contact: Philip Lentz
Director of Communications
212-688-4000 ext. 679
plentz (at) nyhomes (dot) org
