Government Mortgage Relief Programs
Qualifications, Instructions and Resources
In response to the recent housing crisis, the Obama Administration introduced the
Making Home Affordable plan. The MHA plan essentially comprises two mortgage relief
programs to help troubled homeowners - a loan modification program and a refinance
program.
Federal Mortgage Relief - Loan Modifications
This page contains a breif description of the loan modification program. For a
complete description of the qualifications and how to apply go to the Loan Modification
Programs: How to Qualify and Apply page.
The purpose of a mortgage modification is to get your monthly payment to a more
affordable level. An "affordable" mortgage payment is typically defined
as 31% of the borrower's monthly gross income. This is achieved by modifying one or
more components of your mortgage:
- Lowering the interest rate
- Extendeding the life of the loan
- Lowering the loan principle
Eligibility
There are a lot of factors that contribute to a borrower qualifying for the loan
modification. Use the online qualifier provided on this website to determine how
likely you are to qualify for a loan modification:
How to apply
If youre ready to begin negotiating for a loan modification, get
some free advice before contacting your lender. Consider talking to a
HUD-approved, nonprofit housing
consultant and find out how likely you are to qualify for a loan
modification based on your individual mortgage and financial
situation.
What if you don't qualify or have been denied?
If you don't qualify for a loan mod or if you've been denied one in the past, there
are two private programs available to you.
Federal Mortgage Relief - Refinance
Many homeowners pay their mortgages on time but are not able to refinance to take
advantage of todays lower mortgage rates mainly due to a significant decrease in
the value of their home. A Home Affordable Refinance will help borrowers refinance
their first mortgage even if the balance owed is up to 125% of the home value. For
example, let's say the principle owed on your first mortgage is $500k. You may be
able to refinance even if the home value was only $400k.
Eligibility
In order for you to be eligible for the federal refinance program, you must not
have been more than 30 days past due on your mortgage in the most recent 12 months.
Additionally, your primary loan needs to be held by Fannie Mae or Freddie Mac. You
can look this up on their websites:
Additional eligibility factors can be viewed on the Making Home Affordable website.
Additional Mortgage Relief Resources
Associations
Federal
Banks