The following three elements are required to apply to be part of the program:
• you owe no more than $729,750 on your first mortgage
• your monthly payments are more than 31% of your gross monthly income
• the mortgage was obtained before January 1, 2009
If your situation falls into those three parameters, there are several elements to the program which might be of some assistance to you:
• your monthly payment can be reduced to 31% of your gross monthly income; if your mortgage above 38%, the loan is renegotiated to 38%, your payment will be 31% and the government program will provide the 7%
• your interest rate on the loan may be reduced
• the home loan terms may be restructured
• the total amount of your mortgage may be reduced
Confusion Cleared
There may be some confusion about how to access the Hardship Program For Home Loans. The program is financed by the Federal Government, but it is actually enacted by the financial institutions – like banks and mortgage companies – who hold the loans and mortgages. If you meet all of the qualifying elements, your first step is to contact your lender. If they are participating in the HAMP program, they will be able to help you ascertain for certain that you qualify for the Hardship Program for Home Loans. Be forewarned that there should be no modification or past-due fees. There may be costs such as back taxes, and you should be offered either the choice to pay in advance or the option to have those costs rolled into your new mortgage. The program is, currently, being underutilized, so if you meet the requirements, get in to see your lender right away to see if you can start the process towards participating in the Hardship Program for Home Loans.
*Affects pricing. With the No Closing Cost
Option, borrowers finance the closing costs instead of paying for them at
closing. Borrowers who pay closing costs at closing may qualify for a lower
interest rate. Some upfront fees (ex. credit report and appraisal) may apply
and may be credited at closing.
*Refinancing or taking out a home equity loan or line of credit may increase
the total number of monthly payments and the total amount paid when compared to
your current situation.
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