MAKING HOME AFFORDABLE/AMERICAN RECOVERY AND REINVESTMENT ACT (ARRA)
Federal Housing Administration (FHA) & United States Treasury Department has adopted new program requirements to the "Making Home Affordable Modification" Program, (http://www.makinghomeaffordable.gov) as of August 1, 2011, for unemployed homeowners trying to stay in their homes, while seeking re-employment. The changes to FHA’s "Special Forbearance Program" will require servicer to:
- Postpone payments for unemployed homeowners from four months to 12 months, and remove upfront hurdles to make it easier for unemployed borrowers to qualify.
- Also require servicers participating in the current "Making Home Affordable Program (MHA)" to extend the minimum forbearance period to 12 months wherever possible under regulator and investor guidelines.
- Additionally, forbearance under this program will
become available to borrowers who are seriously
***Individuals are encouraged to contact their mortgage loan servicer for more details, and to see if they qualify.
For a HUD Special Forbearance Fact Sheet on the
program changes, see:
The following is summarized from the U.S. Department of the Treasury, “Making Home Affordable” guidelines, http://www.makinghomeaffordable/gov
The American Recovery and Reinvestment Act (ARRA), “Making Home Affordable” mortgage assistance program will assist current or at-risk homeowners to modify loans to more affordable terms.
1. THE HOME AFFORDABLE REFINANCE PROGRAM (HARP):
Homeowners who may be eligible are those who are current on their mortgages, but are not able to refinance to take advantage of today’s lower interest rates due to a decrease in the value of their home.
Details of the program include:
- The mortgage must be owned or guaranteed by
Freddie Mac or Fannie Mac
- The mortgage must have been sold to Fannie Mae or
Freddie Mac on or before May 31, 2009
- The mortgage cannot have been refinanced under
HARP previously unless it is a Fannie Mae loan that
was refinanced under HARP from March-May 2009
- The current loan-to-value (LTV) ration must be greater than 80%
- The borrower must be current on the mortgage at
the time of refinance, with no late payment in the
past six months and no more than one late payment in
the past 12 months
2. THE HOME AFFORDABLE MODIFICATION (HAMP):
If you're not unemployed, but you are struggling to
make your mortgage payments, you may be eligible for
the Home Affordable Modification Program. HAMP
can lower your monthly mortgage payment to 31% of your
verified monthly gross (pre-tax) income.
You may be eligible for HAMP if you meet all of the following criteria::
- You occupy the house as your primary residence
- You obtained your mortgage on or before January
- You have a mortgage payment that is more then 31% of your monthly gross (pre-tax) income
- You owe up to $729,750 on your home
- You have a financial hardship and are either delinquent or in danger of falling behind
- You have sufficient, documented income to support the modified payment
- You must not have been convicted within the past
10 years of felony, larceny, theft, fraud or
forgery, money laundering or tax evasion, in
connection with a mortgage or real estate
- *Eligibility criteria are for guidance only.
Contact your mortgage company to see if you may be
eligible for HAMP.
Information that you will need to provide:
- Information about the monthly gross (before tax) income of your household
- Your most recent tax return
- Information about your assets
- Information about any second mortgage on the house
- Account balances and minimum monthly payments due on credit cards
- Account balances and monthly payments on all other debt such as student and car loans.
- A letter describing the circumstances that caused your income to be reduced or expenses to be increased (job loss, divorce, illness, etc.)
BEWARE OF FORECLOSURE RESCUE SCAMS:
- No fee will be associated with acquiring information about Making Home Affordable from a lender or HUD Housing Counselor.
- Beware of persons or organizations that ask for a fee for supplying housing counseling on a homeowner’s delinquent loan.
- Beware of scams that say they can “save” your home if you sign over the deed to your house.
- Never make mortgage payments to anyone other than your mortgage lender.
TO FIND PROVIDERS IN CONNECTICUT'S COMMUNITY RESOURCE
Search by Agency or Program Name: Mortgage
Delinquency & Default Counseling
United States Treasury Department: Making Home Affordable Program
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CONTENT LAST REVIEWED: March2014