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 servicers 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
NOTE: The program will not
apply to loans backed by:Fannie Mae and Freddie
Mac, which are under government control but are
aligned with separate independent regulators.
***Individuals are encouraged to contact their mortgage loan servicers for more details, and to see if they qualifiy.*** The program will expire on December 31, 2013.
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
- 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
- http://knowyouroptions.com/options-to-stay-in-your-home/home-affordable-refinance-program-option (800-732-6643)
- www.freddiemac.com/avoidforeclosure (800-373-3343)
- To find lender information, see: http://www.hopenow.com
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
- You obtained your mortgage on or before
January 1, 2009
- 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
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.
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United States Treasury Department: Making Home Affordable Program
PREPARED BY: 211/tb
CONTENT LAST REVIEWED: March2013