Obama"s Federal Loan Modification Plan Will Help You Stay in Your Home and Save You Money
When the economy crashed last Spring, it did more than raise prices and cost people retirement savings. It also caused many people to struggle to make their monthly house payment, and in some cases, many people became delinquent. President Obama has instituted a loan modification program that is designed to help these people stay in their homes and not become another victim to foreclosure. The plan will issue new, more affordable mortgages to those who qualify.
The plan called for $75 billion to be set aside for banks and other lending institutions to use in order to help people refinance their mortgage and get out from under mortgages already in default. It is estimated that as many as 7 to 9 million homeowners will benefit from the program.
If you believe you might have the necessary circumstances to qualify for a loan modification, then here are a few tips and guidelines you should know.
* The home you are trying to refinance must be your primary residence.
* You don't have to currently be behind on your payments but must be able to show that a financial hardship is being caused by making the payments each month.
* Your current mortgage must have originated prior to January 1, 2009.
* The amount of your monthly house payment needs to be more than 31% of your gross monthly income.
* Your total mortgage that you are applying for does not exceed $729,750.00.
* You can prove and have the documentation to show a financial hardship or extreme conditions.
* A second mortgage that you have may be included.
* There is not cost for applying for a new loan modification.
You may need to shop around to find a lending institution that is participating in this program because it is on a voluntary basis. Although the federal government is giving financial incentives to those banks who chose to participate. Also, you will be rewarded if you are able to remain current on the new loan. For every year, up to five years, the government will credit your new mortgage $1,000.00 towards the principle for a total of $5,000.00.
If you are struggling financially, now is a great time to try and refinance your home. The loan modification package will be a big help to you and your family.
The plan called for $75 billion to be set aside for banks and other lending institutions to use in order to help people refinance their mortgage and get out from under mortgages already in default. It is estimated that as many as 7 to 9 million homeowners will benefit from the program.
If you believe you might have the necessary circumstances to qualify for a loan modification, then here are a few tips and guidelines you should know.
* The home you are trying to refinance must be your primary residence.
* You don't have to currently be behind on your payments but must be able to show that a financial hardship is being caused by making the payments each month.
* Your current mortgage must have originated prior to January 1, 2009.
* The amount of your monthly house payment needs to be more than 31% of your gross monthly income.
* Your total mortgage that you are applying for does not exceed $729,750.00.
* You can prove and have the documentation to show a financial hardship or extreme conditions.
* A second mortgage that you have may be included.
* There is not cost for applying for a new loan modification.
You may need to shop around to find a lending institution that is participating in this program because it is on a voluntary basis. Although the federal government is giving financial incentives to those banks who chose to participate. Also, you will be rewarded if you are able to remain current on the new loan. For every year, up to five years, the government will credit your new mortgage $1,000.00 towards the principle for a total of $5,000.00.
If you are struggling financially, now is a great time to try and refinance your home. The loan modification package will be a big help to you and your family.