LOAN MODIFICATION
Relieve your stress with a Loan Modification.
In March 2009, the U.S. government created the Making Home Affordable Program (MHA). Part of the MHA is a loan modification program called the Home Affordable Modification Program (HAMP). HAMP is designed to enable borrowers that meet eligibility requirements to avoid foreclosure by modifying loans to an affordable level, and sustainable for the long-term.
The program provides clear and consistent loan modification guidelines that the entire mortgage industry can use.
Borrower eligibility is based on meeting specific criteria including:
- borrower is delinquent on their mortgage or faces imminent risk of default
- property is occupied as borrower's primary residence
- mortgage was originated on or before Jan. 1, 2009 and unpaid principal balance must be no greater than $729,750 for one-unit properties.
After determining a borrower's eligibility, a servicer will take a series of steps to adjust the monthly mortgage payment to 31% of a borrower's total pretax monthly income:
- First, reduce the interest rate to as low as 2%,
- Next, if necessary, extend the loan term to 40 years,
- Finally, if necessary, forbear (defer) a portion of the principal until the loan is paid off and waive interest on the deferred amount.
The Merna Law Group can assist you in applying for a loan modification through the HAMP program. Call today to schedule a consultation.
