Yes. Making Home Affordable offers help to borrowers who are already behind on their mortgage payments or who are struggling to keep their loans current. By providing mortgage servicers with financial incentives to modify existing first mortgages, the Treasury hopes to help as many as 3 to 4 million homeowners avoid foreclosure regardless of who owns or services the mortgage.

How do I know if I qualify for a Home Affordable Modification?

To apply for a Home Affordable Modification, you must:

Be an owner-occupant in a one to four unit property, and have an unpaid principal balance that is equal to or less than $729,750 (for one unit properties and higher for two to four unit properties (consult your servicer),

Have a loan that was originated before January 1, 2009.

Have a mortgage payment (including taxes, insurance, and home owners association dues) that is more than 31% of your gross (pre-tax) monthly income, and have a mortgage payment that is no longer affordable, perhaps because of a significant change in income or expenses.

If you answered YES to all of these questions, you are eligible to apply for a Home Affordable Modification. Only your servicer will be able to tell you if you qualify.

What if I don’t qualify or my lender is not participating in the Home Affordable Modification Program?

While 3-4 Million Homeowners are expected to qualify and most major lenders are expected to participate, in the event you cannot participate in this program, we are an ethical, full service Loss Mitigation firm dedicated to helping homeowners retain their homes. Contact us today at 1-877-467-3588.

Do I need to be behind on my mortgage payments to be eligible for a Home Affordable Modification?

No. Responsible borrowers who are struggling to remain current on their mortgage payments are eligible if they are at risk of imminent default, for example, because they have had or will soon have a significant increase in their mortgage payment that they cannot afford. If you have had or anticipate a significant increase in your mortgage payment or have had a significant reduction in income, contact your servicer. If you meet the minimum eligibility criteria for a Home Affordable Modification, your servicer is required to evaluate your loan to see if you are at risk of imminent default.

I have missed some mortgage payments am I eligible?

If you answered yes to the questions above, have missed two or more mortgage payments and your servicer is participating in the Making Home Affordable Program, your servicer must evaluate your loan to determine if you qualify for a modification.

I have a second mortgage. Am I still eligible?

Yes, but only the first mortgage is eligible for a modification under Making Home Affordable Loan Modification Program.  Any negotiations on the second mortgage would be between you and your lender and does not affect the federal guidelines.

How do I know if my servicer is participating? Are all servicers required to participate?

Servicer participation in the program is voluntary. However, the government is offering substantial incentives to servicers and investors, and it is expected that most major servicers will participate. Participating servicers will sign a contract with Treasury’s financial agent, through which they agree to review every potentially eligible borrower who calls or writes asking to be considered for the program. As contracts are signed, a list of participating servicers will be available on the Internet at www.FinancialStability.gov. Participation will be mandatory for any servicer that accepts future funding from the Treasury’s Financial Stability Program.

What will my servicer do to determine if I qualify?

Your servicer will:

Determine that your loan meets the minimum eligibility criteria (owner occupied, originated before January 1, 2009, UPB equal to or less than $729,750). If yes:

Obtain sufficient income information to determine if your monthly mortgage payment is more than 31% (approximately 1/3) of your gross or pre-tax monthly income. (Your servicer may initially accept verbal information about your income, but eventually you will need to provide proof of income in the form of tax returns and pay stubs). If yes:

Add past due charges (interest, taxes, insurance and costs that your lender paid to other parties on your behalf – but not late fees, those must be waived) to the loan balance.

Determine how much of an interest rate reduction will be required to get your mortgage payment down to a point where it is about 31% of your gross monthly income.

Apply a test to determine if the cost of the modification (including the government’s incentive payments) is less costly for the investor than a foreclosure. If yes:

Put you on a trial modification for three months at the new interest rate and payment.

If you successfully make the payments and are current at the end of the trial period, your servicer will execute a permanent modification agreement that will lower your interest rate to a fixed rate for five years.

The modification payment will also include a monthly amount to be set aside (escrowed) to pay taxes and insurance when they become due. This escrow is required even if your prior loan was not escrowed.

What happens after five years?

If the modified interest rate is below the market rate, the modified rate will be fixed for a minimum of five years as specified in your modification agreement. Beginning in year six, the rate may increase no more than one percentage point per year until it reaches the rate cap indicated in your modification agreement. The cap is equal to the prevailing market interest rate on the date the modification is finalized as published by Freddie Mac based on a survey of its customers. This cap means that your rate can never be higher than the market rate on the day your loan was modified. If the modified rate is at or above the prevailing market rate, the modified rate will be fixed for the life of the loan.

How low can my interest rate go?

Treasury is providing incentives to your investor to write the interest down as low as 2%, if necessary to get to a payment that you can afford based on your income.

What happens if that is not enough to get to an affordable payment?

If a 2% interest rate is does not result in a payment that is affordable (31% of your gross monthly income), your servicer will:

First try to extend your payment term. At the servicer’s option your payments could be extended out to 40 years.

If that is still not sufficient your servicer will defer repayment on a portion of the amount you owe until a later time. This is called a principal forbearance.

A portion of the debt could be also be forgiven. This is optional on the part of the investor. There is no requirement for principal forgiveness.

Could I end up with a balloon payment?

Yes. If your servicer determines that a principal forbearance is required to get your monthly payment to an affordable level, the amount of the forbearance. Say for example this was $20,000, would be subtracted from the amount used to calculate your monthly mortgage payment, but you would still owe the money. You would have a $20,000 balloon payment that had no interest and was not due until you paid off your loan, refinanced or sold your house.

Is housing counseling required under this program?

Borrowers, especially delinquent borrowers are strongly encouraged to contact a HUD-approved housing counselor to help them understand all of their financial options and to create a workable budget plan. These services are free. However, housing counseling is only required for borrowers whose total monthly debts are very high in relation their incomes, and it is voluntary for others.

When you apply for a Home Affordable Modification, your servicer will analyze your monthly debts, including the amount you will owe on the new mortgage payment after it is modified, as well as payments on a second mortgage, car loans, credit cards or child support. If the sum of all of these recurring monthly expenses is equal to or more than 55% of your gross monthly income, you must agree to participate in housing counseling provided by a HUD-approved housing counselor as a condition of getting the modification.

I heard the government was providing a financial incentive to borrowers. Is that true?

Yes. Borrowers who make timely payments on their modified loans will receive success incentives. For every month you make a payment on time, Treasury will pay an incentive that reduces the principal balance on your loan. Over five years the total principal reduction could add up to $5,000. This contribution by the Treasury will help you build equity faster.

I do not live in the house that secures the mortgage I’d like to modify. Is this mortgage eligible for a Home Affordable Modification?

No. For example, if you own a house that you use as a vacation home or that you rent out to tenants, the mortgage on that house is not eligible. If you used to live in the home but you moved out, the mortgage is not eligible. Only the mortgage on your primary residence is eligible. The mortgage servicer will check to see if the dwelling is your primary residence.

I have a mortgage on a duplex. I live in one unit and rent the other. Will I still be eligible?

Yes. Mortgages on two, three and four unit properties are eligible as long as you live in one unit as your primary residence.

I have two mortgages. Will a 2009 Obama Mortgage Relief Plan reduce the payments on both?

Only the first mortgage is eligible for a modification.

I owe more than my house is worth. Will a Home Affordable Modification reduce what I owe?

The primary objective of the Making Home Affordable Program is to help borrowers avoid foreclosure by modifying troubled loans to achieve a payment the borrower can afford. Investors may, but are not required to, offer principal reductions. However, it is more likely that your servicer will use interest rate reductions in order to make your payment affordable.

I have an FHA loan. Can it be modified under the making Home Affordable Program? Are all loans eligible?

Most conventional loans including prime, subprime, adjustable, loans owned by Fannie Mae, Freddie Mac, private lenders and most loans in mortgage backed securities are eligible for a Home Affordable Modification. The Administration is working with the Congress to enact legislation that will allow FHA, VA and USDA to offer modifications consistent with Making Home Affordable in the near future. Currently loans insured or guaranteed by these agencies are being modified under other programs that also enable borrowers to retain homeownership.

What should I do if my servicer tells me that the “investor” is not participating in Making Home Affordable?

As contracts with servicers and investors are signed, the list of participants will be posted at www.financialstability.gov. Borrowers should first check there to see if their servicer is listed. If so, you should call your servicer back and ask to speak to a supervisor or you may contact a HUD-approved housing counselor for assistance. If your servicer is not participating in the program, you should ask your servicer or a housing counselor about other workout options that may be available.

I’m already working with my servicer or a housing counselor on a loan workout. Can I still be considered for a Home Affordable Modification?

Yes. You should ask your servicer or counselor to explain the benefits of all available foreclosure prevention or payment reduction options. A Making Home Affordable Modification is one of many valuable tools available to your servicer. Other options may be more appropriate for your situation.

How do I apply for a modification under the Homeowner Affordability and Stability Plan?

If you meet the general eligibility criteria for the program, you should gather the financial documentation that your servicer will need to determine if you qualify. Once you have this information, you should call your mortgage servicer and ask to be considered for a Home Affordable Modification. The number is on your monthly mortgage bill or coupon book.

If your loan is current, please be patient. Treasury just published detailed program requirements on March 4, 2009 and it will take some time before servicers are fully operational. However, the Treasury has encouraged servicers to immediately begin reviewing the eligibility of delinquent borrowers that are at the greatest risk of foreclosure.

If you have already missed one or more mortgage payments and have not yet spoken to your servicer call them immediately.

What information and documents will I need?

It will help your servicer and speed processing of your application if you gather the some information and documents before you call. You will need:

Information about the monthly gross income of your household, including recent pay stubs if you receive them or documentation of income you receive from other sources.

Your most recent income tax return.

Information about your assets

Information about any second mortgage on your house.

Account balances and minimum monthly payments due on all of your credit cards.

Account balances and monthly payments on all your other debts such as student loans 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.).

Obama has put into place several different grant programs to help various individuals and families to reduce their debt load. No matter where you debt comes from you may be able to find something to help you out. There are programs for mortgage payments, business debt, education scholarships, and loan consolidation just to mention a few. The basic requirements include your age which must be 18 or over; your nationality, being American; and your income level, needing to be less than $30,000. You will have to supply some personal information when applying, of course, such as social security number, debt information, and various other facts about yourself. The process itself is no worse than declaring bankruptcy and it benefits you a whole lot more, including a credit rating that remains the same if not better than what you had before.

There are many categories for these grants depending on the situation. Mortgage, small-business, multiple loans, education, tax rebates, and medical bills have all been included plus there are more. You will need to do a bit of research to find which one or ones are suitable for you. When you do this, get the application and gather your personal information and documents and head on down to the debt relief agency that’s closest to you. If you are not sure where it is you can find it online or in the telephone directory. It’s that simple.

It is Obama’s hope that people will start realizing this good news and start applying. For his plan of reviving the economy, he needs everyone that falls into these categories to take their share of the funds. It was put there for this reason. If you know someone aside from yourself who may be interested in this, share the news and make their day a brighter one too.

There are numerous government grants that might have your name on them. Even if your debt seems to come from one hundred and one different places, you can apply for more than one if you meet the requirements. They even have a special one in existence for situations where there are various loans, credit card debts and more. It is through the loan consolidation grant program. There is also one for mortgages, small business, education, and more.

The government has put millions of dollars into these programs and much of it goes unclaimed when there are so many families that need it. Some of it is because news isn’t traveling fast enough, and some because of the negative publicity that they are getting. Either way, more individuals and families need to find out about them. It could change their lives like that have with so many other people.

These grants can eliminate the majority of your debts which gives you a lot more financial freedom to better your quality of life. Of course there will still be some debt to deal with, but it will be much easier to deal with after some has gone. Plus the cash amounts of interest you will have to pay will be decreased because of the lower principle. That is what you call chain reaction savings. It’s a wonderful thing.

Not all homeowners will be eligible for a government bailout, although a large portion will be. In general, there are some banks that are giving borrowers personal loans to cover their back payments on their home loans.

This might sound a little confusing to you, but everyone from the banking sector to the government is doing everything possible to help people catch up on their payments and not default. Nobody has ever received a bailout like this before when they were behind on their mortgage payments, so it is definitely a blessing for those who need a little assistance so they won’t lose their home.

If you are behind on your mortgage and aren’t sure how you will make your next payment, then you ought to call your bank. Tell them your situation and ask if they have any programs that will assist you.

Banks are hearing this story a lot more frequently these days so it is likely they will have some option to assist you. However, you will never know if your bank is able to help you if you don’t call. It is certainly easier to ignore the situation, but all this will get you is losing your house. So, pick up the phone and call your bank.

There is also a Mortgage Forgiveness Debt Relief Act of 2007 that was put in place to assist the families affected most. This Act helps families reduce the amount of their monthly payment so they can afford the payments and avoid foreclosure. It also allows homeowners to refinance their house and not be subject to the higher taxes.

This is really important because it allows homeowners to save money and put it towards their mortgage payment. The Act helps homeowners not pay taxes on any debt forgiveness as a result of house devaluation. With this Act forgiven portions of the debt are not considered income, so they are not taxed.

There have been quite a few people to take advantage of the provisions of this Act and it is highly likely many more will do the same. Nobody wants to default on their home and have it go through foreclosure. But, some of them simply have no other option. This is especially so for those who have high mortgages, but the value of their home has dropped so much that paying 250,000 dollars for a house valued at 160,000 dollars just doesn’t make sense to many borrowers.

Who knows what will happen with the home loan crisis. Hopefully, things will get better soon and the banking industry will be back to normal. This does not look to be the case, though, so it is more important than ever for the homeowners and the banks to work together and find a solution to help owners pay and keep the banks from losing so much.

Student loans can be overwhelming. Now, one may repay his/her student loans using a repayment schedule based on household income and size. Any amount still owed after 25 years will be forgiven as long as payments have been kept current. If one loses his/her job or the household income decreases, changes will be made to payment amount owed.

Credit card companies are no longer free to charge skyrocketing interest rates and hidden fees, thus giving the consumer better chances of paying lower bills each month. For those who have already defaulted on payments, programs are available to work with the credit card companies to lower payments and come to agreements decreasing total payoff amount due.

Mortgage lenders are now modifying the existing loans by either reducing interest rates or lengthening the terms of the loan, therefore reducing monthly payments. This is an option for homeowners who are currently in default and at risk of foreclosure as well as for those who are not. There are eligibility requirements for loan modifications and they are available through your lender.

These are just a few of the many programs being offered by the federal government to help reduce the amount of personal debt. Further information may be obtained for free through government sites.

No one wants to be drowning in the sea of debt that we have created for ourselves. The high cost of credit cards make it difficult to repay what is owed. Congress has now passed bills that are meant to limit the amount of interest and hidden fees a credit card company may charge to its cardholders. This should help alleviate some of the personal debt one accumulates each month.

Good news for those who are struggling to pay the mortgage. Loan Modifications are now widely available through your lender that will cut the cost of your monthly payment, making your home more affordable. Talk to your mortgage holder for more information and understand your options.

Are those daunting student loans hanging over your head? Student loan repayment schedules are now based upon the amount of money you make and the number of people in the household. If your payments remain current, after 25 years all remaining money owed is discharged.

It will be a process, but there are programs available for help in these financially difficult times. Qualifying is easy and applying only takes a few short moments of your time!

What this bailout plan does is, unfortunately, pretty limited. It won’t help out everyone. What the bailout does on the level of the individual borrower is to freeze the borrower’s mortgage for five years. This keeps the interest rate of the mortgage down for a period of time so that the borrower can get their finances in order and dig themselves out of their situation. Unfortunately, there are a couple of stipulations on this program.

The first stipulation is that it only applies to people who have less than 3% equity on their homes. People with higher equity are simply out of luck. The second qualification is that the borrower must be no more than 60 days late paying their mortgage. Needless to say, for people who are already in severe trouble and have been missing payments aren’t helped at all by this.

In addition to the above qualifications a buyer would have to prove that he or she couldn’t afford increased interest in their mortgage. The government buyout plan also only applies to subprime mortgages – but there are many people struggling with prime mortgages who face financial difficulties, too. Unfortunately, this leaves a lot of people who were looking for a little relief out of luck.

The ultimate problem with this bailout program is that it only serves to delay inevitable outcome. The bottom line is that if you are living in a home that you can’t afford to live in, even if the government bailout helps you, you may still find yourself in trouble. Unless a significant financial change or a reduction in the interest rate or principle is in the wings, you chances are at the end of the five-year freeze you still won’t be in a good place.

Another perceived problem with the government bailout program is that it works to reinforce the behavior that put the housing market in the crisis it faces today. Subprime lending encouraged people to try and buy houses that they couldn’t really afford, and the bailout program is helping those same people. Meanwhile, people who had made smart choices about buying a home, but faced some other financial problem are left high and dry.

The unfortunate bottom line is that if you can’t pay your mortgage, chances are that the government bailout isn’t going to save you from foreclosure. Unless you have good reason to believe there’ll be a change in your financial fortune, it may be time to start preparing for the worst.

As analysts compare our economic situation to the early century’s great depression the more our government and president Obama are thinking of ways in which to help us through programs for debt relief. Contrary to all the hype we have been hearing there is no one grant that will pay off your credit card debt. What is present is the government initiated or prescribed debt restructuring programs. If a mortgage is restructured then the payment or monthly dues will lessen. This money saved can then be channeled elsewhere, perhaps to credit card debt?

Hand in hand with these restructuring projects/grants there is also a need to wisely identify which debts one should prioritize first. The national foundation for credit counseling is designed to help consumers understand the wise use of credit. You are assigned a certified counselor. This counselor will go over your debt and income. Together you will find a budget that will work for you. They often work together with the credit card companies to work out a reduced interest, no fees, and lower payments program. The selection of the proper organization to help you achieve your goals can spell success to you. Remember if its sounds too good to be true chances are it is not. So research and find the path that is best for you.

If it is business that is giving you this financial burden, whether it’s a longstanding company or you are just beginning, there is small business grant program that can help. If you are a successful applicant then you can receive thousands of dollars to get you out of this jam and put you back into better working order.

Mortgages are a big part of why so many people are sinking in debt. Lucky for these individuals and for you if that is your situation, you can apply for the mortgage forgiveness program. If it’s not the mortgage that is doing it to you, but a lack of sufficient income, then there are also grants for this purpose as well. Both of these grant programs require you to prove how much you need the money.

For those who want to get their post-secondary education and either can’t afford it or don’t want to have that huge student loan at the end, there are education grants and scholarships available. Millions of dollars are there to be taken simply because Obama wants to encourage everyone to be educated.

These grants are excellent opportunities for anyone in these circumstances to apply for. Not only can they change your life, but in using them, you will be contributing to the cause of bettering the economy.