![](\"https:\/\/www.floridarealtors.org\/sites\/default\/files\/styles\/full_width_main_image\/public\/page\/image\/2019-10\/gettyimages-1125625723_1.jpg?h=7310a2c1&itok=tqzPELcn\")
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More at-risk homeowners with a loan-to-value ratio less than 80% can now qualify for a lower-interest-rate refinance if Fannie Mae or Freddie Mac own their loan. <\/span><\/span><\/p>\n<\/div>\n WASHINGTON \u2013 In an effort to help more homeowners hurt by the pandemic, the Federal Housing Finance Agency (FHFA) announced changes to loan modification terms. Homeowners once turned down for a lower-interest-rate refinance (refi) may now qualify.<\/span><\/span><\/p>\n The new option applies to loans backed by Fannie Mae or Freddie Mac \u2013 more than half of all U.S. conventional mortgages. The updated terms are specifically for borrowers with permanent COVID-19 hardships.<\/span><\/span><\/p>\n Until now, only borrowers with mark-to-market loan-to-value (MTMLTV) ratios greater than or equal to 80% were eligible for a possible interest rate reduction. MTMLTV is a ratio that compares the balance remaining on the mortgage to the current market value of a home. Homeowners with less than 20% home equity could not do a refi.<\/span><\/span><\/p>\n Now, FHFA says its Flex Modification terms will be adjusted for COVID-19 hardships and make it possible for eligible borrowers \u2013 regardless of the borrower\u2019s loan-to-value ratio \u2013 to refinance their mortgage. <\/span><\/span><\/p>\n \u201cAllowing more families to qualify for an interest rate reduction will prevent unnecessary foreclosures, help strengthen (Fannie Mae and Freddie Mac\u2019s) books of business, and make sustainable homeownership a reality for more families currently living with the uncertainty of forbearance,\u201d FHFA Acting Director Sandra L. Thompson said when announcing the change.<\/span><\/span><\/p>\n\n