Aug 142011

Loan ModificationMaking Home Affordable Program has a special loan modification program for people who are on the verge of losing their home to mortgage companies. This program is aimed at helping those who have defaulted on their mortgage payments and are facing the risk of foreclosure.
Under this loan program, qualifying home owners can get their homes refinanced at a lower rate of interest. Here are some important fact relating to this loan modification program that has been initiated by the United States Government on the behest of President Obama.
  • The program is being sponsored by the federal government and billions of dollars of aid has been earmarked for use in this program, including the HARP loan refinance program.
  • If you owe more than the current value of your home, pursuing a loan modification program is bound to benefit both you and your bank. You would be benefitted in the way that you would get to keep your home and the bank would be benefitted in the way that it would not lose its loan amount.
  • Not all borrowers are eligible for assistance with this mortgage relief program. While most people say that this program includes anyone who is about to lose his or her home, this is not the case. There are certain pre-conditions or qualifying criteria that needs to be met in order to avail the facilities under this program.
  • This program is a way to explain to your lender your situation and to describe the reasons as to why you have not been able to pay your mortgage on time. So it is best to attach any back up documentation that you have to show your inability to pay the mortgage on time.
  • The program would provide you with a payment program that is easier on your pocket. Your target payment needs to be calculated according to your current income and paying capacity so you need to discuss with your bank on terms that would protect you from defaulting on your loan in the future.
  • Contrary to rumors, your loan modification application would be carefully reviewed by your lender before he or she decides to include your application in the loan modification program. Hence make sure that everything has been disclosed and is correct.
  • The government or the federal system is not going to contact you to apply for a loan modification program. Also since the program is going to be offered to a limited number of people it is advisable to apply as early as possible so as to have maximum chances of being included in the program.
  • Your lender would require some proof from your side that you would be able to pay your new installments after your loan is modified by your lender. For this you would have to supply to your lender all the documentation that is required.

These are some very important facts which you need to remember before applying for a loan modification procedure under the Making Your Home Affordable Program, including both the HAMP and HARP. The program is a great opportunity for people who are on the verge of losing their homes and can be very helpful for those who have no other place to go to.

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