Loan Modification, Hope For Homeowners, Home Affordable

Making Home Affordable Program

Making Home Affordable will offer assistance to as many as 7 to 9 million homeowners, making their mortgages more affordable and helping to prevent the destructive impact of foreclosures on families, communities and the national economy.

The Home Affordable Modification Program (HAMP) will help up to 3 to 4 million at-risk homeowners avoid foreclosure by reducing monthly mortgage payments. Working with the banking and credit union regulators, the FHA, the VA, the USDA and the Federal Housing Finance Agency, the Treasury Department today announced program guidelines that are expected to become standard industry practice in pursuing affordable and sustainable mortgage modifications. This program will work in tandem with an expanded and improved Hope for Homeowners program.

The Home Affordable Modification program ends in December 2012.

Mortgage must be over 31% of borrower monthly gross income

Must live in property (1-4 units)

Less than $729,000 on their 1st/2nd loans okay

Loan originate before Jan. 1st, 2009

Current or mortgage lates okay (Pending NOD "Notice of Default"/No NOS "Notice of Sale")

Must have a financial hardship (i.e. job loss, reduced income, divorce, etc.)

The Home Affordable Refinance program (HARP) will be available to 4 to 5 million homeowners who have a solid payment history on an existing mortgage owned by Fannie Mae or Freddie Mac. Normally, these borrowers would be unable to refinance because their homes have lost value, pushing their current loan-to-value ratios above 80%. Under the Home Affordable Refinance program, many of them will now be eligible to refinance their Fannie Mae or Freddie Mac loan up to 125% LTV and to take advantage of todays lower mortgage rates or to refinance an adjustable-rate mortgage into a more stable mortgage, such as a 30-year fixed rate loan.

The Home Affordable Refinance program ends in June 2011.