… with an estimated 20.4 million homeowners in the United States who now owe lenders more than their homes are worth because of the across-the-board decline in home values, according to a recent study from Zillow.com:

” … the number of borrowers who are underwater climbed to 20.4 million at the end of the first quarter [2009] from 16.3 million at the end of the fourth quarter [2008]. The latest figure represents 21.9 percent of all homeowners, [which is] up from 17.6 percent in the fourth quarter and 14.3 percent in the third quarter.”

Obama’s plan, which is often referred to as the “Making Home Affordable” program, is intended to “stimulate” the housing market and reduce interest rates/loan amounts for homeowners struggling to meet their monthly mortgage obligations.

Typically, homeowners who are “underwater” are not permitted to refinance their mortgages, but now the has changes for loans backed by Fannie Mae and Freddie Mac under the new initiative.

To learn more about Making Home Affordable and determine whether or not you can refinance your home mortgage click here. The official “Making Home Affordable” Web site can be found right here.

“We are at a time where people can really take advantage of this…. The main message we want to send today is there are 7 to 9 million people across the country who right now could be taking advantage of lower mortgage rates. That is money in their pocket.”

– President Barack Obama is urging homeowners to take advantage of super low mortgage interest rates through the recently introduced Making Home Affordable program to possibly ease their financial burdens. He made the remarks in the White House’s Roosevelt Room alongside several other key individuals who are charged with getting the housing market back on track, which includes ensuring that people are able to afford their homes and remain in them to avoid more foreclosure situations. According to an Associated Press report, nearly 200,000 homeowners contacted Bank of America alone “to find out if they are eligible to refinance under the Obama administration’s new guidelines.” To learn more about Making Home Affordable and determine whether or not you can refinance your home mortgage click here.

The Mortgage Bankers Association reports today that rates on 30-year mortgages fell from 4.89 percent last week to a current figure of 4.63 percent. Unsurprisingly, the refinance rate jumped as a result, increasing 72.9 percent during that span as opportunistic homeowners scrambled to reduce their existing interest rates.

In fact, more than 75 percent of those applicants were current homeowners and the remainder came from new homebuyers.

An Associated Press report tells us how it all came to be:

“Interest rates have plunged since the Federal Reserve said in November it would buy up to $500 billion in mortgage-backed securities in an effort to bolster the long-suffering housing market. Last week, the Federal Reserve went further, announcing a $1.2 trillion effort to lower rates on mortgages and other consumer debt in a bid to revive the economy. The effort includes buying up to $300 billion in long-term government bonds and $750 billion in mortgage-backed securities guaranteed by Fannie Made and Freddie Mac.”

Up until recently most homeowners were unable to take advantage of the great rates because of the collective nosedive that the housing market took in the past few years. They became upside-down on their mortgages, meaning that they owed their lenders more than their homes were worth .

Refinancing under those conditions was next to impossible.

The good news is things are a little different now thanks to the “Making Home Affordable” program, which was introduced on March 4 to “stimulate” the housing market and reduce interest rates/loan amounts for homeowners struggling to meet their monthly mortgage obligations.

For more on the particulars of that program click here.

More than 11 million Americans are out work — and perhaps three million more could join them before 2009 expires.

In fact, the national unemployment rate is at its highest level (7.6 percent) since 1992. And it could surge more than a full point in 12 months or less to highs that have not been recorded in more than 25 years.

This harsh reality is a major problem for many reasons — people who can’t find work can not earn a living. Perhaps more alarming, many of these individuals are homeowners who are either having trouble making their monthly mortgage payments or will very soon of their situations do not improve.

And when homeowners don’t pay their mortgages on time they run the risk of falling into foreclosure.

It’s a slippery slope and a primary reason foreclosures have increased across the board in the last year and could continue to rise in the future.

CitiMortgage, which is the major mortgage lending arm of Citigroup, has apparently picked up on this unfortunate trend and is doing something about it, announcing today that “newly laid-off borrowers” will be allowed to “pay a substantially reduced mortgage, around $500 a month, for three months while they hunt for a new job,” according to Forbes.com.

However, only mortgages below the $417,500 threshold qualify. And after the 90 days are up, the article indicates that unemployed borrowers still in the program will be dealt with on a “case by case basis.” In addition, those in the program who find work before the three-month mark could be eligible for a long-term loan modification.

Therefore, if you are unemployed and struggling to satisfy your CitiMortgage loan responsibilities it would behoove you to give them a call and enroll in the program. It could make a major difference and provide you with valuable time while you get back on your feet.

Foreclosure.com Founder, President and CEO, Brad Geisen, had this to say in a high profile Associated Press interview back in June 2006 regarding the looming housing market crisis:

“Adjustable Rate Mortgages [ARMS]are a ticking time bomb. I’m pretty sure we’ll see a high volume of foreclosures.”

Bloomberg News columnist John F. Wasik today ran a story with the headline, “U.S. Mortgage Time Bomb Needs Defusing Yesterday,” saying the following:

“Of the $200 billion of these [ARM] loans outstanding, almost $30 billion is due to reset this year and $67 billion in 2010…. The resets inflict more trauma on the U.S. housing market. The average option ARM monthly payment will soar 63 percent — or $1,052.”

Brad and several other knowledgeable industry experts were able to see the “toxic mortgage” trouble coming several years ago even when the housing market was moving.

That’s because “balloon” loans are a big factor behind foreclosures, affecting millions of homeowners nationwide who become unable to afford their mortgages when interest rates “adjust” to higher percentages.

Unfortunately, it appears that the problem could continue well into next year if swift action is not taken — something that should have happened “yesterday” indeed.