President Obama recently announced the Administration’s plan to further prevent foreclosures and assist borrowers with mortgage loan modifications in our country by the passing of the “Making Home Affordable” Homeowner Affordability and Stability Plan which has gotten a lot of media coverage in March of 2009. What is important to understand that as of the end of March 2009, lenders have not received the specifications or guidelines in such a way that they have been put into full effect: According to the Government Administration responsible for these Two Possible Program Eligibilities “Lenders and servicers have started to implement the program and there may be a slight delay before they are prepared to process all applications. MANY LENDERS HAVE MADE A COMMITMENT TO DELAY FORECLOSURE ON ALL LOANS THAT MEET THE MINIMUM ELIGIBILITY CRITERIA.”
What can you expect from this refinance/modification tool?
If you are currently delinquent or struggling to keep current, you may be eligible for the Home Affordable Modification on your current loan. If you are current on your mortgage and your loan is held or guaranteed by Fannie Mae or Freddie Mac, you may be eligible to be refinanced through the Home Affordable Refinance program.
Until the modification program is available, you should gather the information that you will need to provide to the lender or the modification negotiator. This includes:
- Information about the monthly gross (before tax) 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 savings and other assets.
- Information about your first mortgage, such as your monthly mortgage statement.
- Information about any second mortgage or home equity line of credit on the 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 any circumstances that caused your income to be reduced or expenses to be increased (job loss, divorce, illness, etc.) if applicable.