MORTGAGE RELIEF PLAN

I recently camw across some excellent info on Mortgage Relief Plan details.  As you know there is a great amount of conflicting information and I hope this data will help to clarify things!

MORTGAGE RELIEF PLAN DETAILS

Source: Inman News

President Barack Obama's new mortgage relief plan, launched last month, aims to help up to 9 million borrowers qualify for more affordable mortgages and stay in their homes. Obama's "Making Home Affordable" program is designed to work with lenders to modify the loan terms for up to 4 million homeowners and to refinance up to 5 million homeowners into more affordable fixed-rate loans.

TO QUALIFY FOR REFINANCING

Only homeowners in good standing whose loans are held by Fannie Mae or Fredie Mac qualify.

DETAILS

*  The property must be owner-occupied, and the borrower must have enough income to make payments on the new mortgage debt.

*  Borrowers can't owe more than 105 percent of their home's current value on their first mortgage. For example, if your home is worth $200,000, your first mortgage can't exceed $210,000. Borrowers with a second mortgage still can qualify as long as their first mortgage isn't more than 105 percent of their home's value.

*  Homeowners can't take cash out during the refinancing to pay other debt.

*  Borrowers have until June 2010 to apply.

FANNIE MAE, FREDDIE MAC LOANS

Call your lender or mortgage servicer to see if you have one.  You can find the phone number on your monthly mortgage statement or coupon book.

You can also contact Fannie Mae at 1-800-7FANNIE and Freddie Mac at 1-800-FREDDIE from 6:00am to 6:00pm MST.  Or go to www.fanniemae.com/homeaffordable and www.freddiemac.com/avoidforeclosure and fill out the online request forms.

TO QUALIFY FOR THE MODIFICATION PROGRAM

Delinquent borrowers and current borrowers who are at risk of imminent default are both eligible.

DETAILS

*  The program applies to mortgages made on Jan. 1 or earlier.  The mortgage payment including taxes, insurance and homeowners association dues must exceed 31 percent of the borrower's gross monthly income.

*  The property must be the homeowner's primary residence. Home loans for single-family properties that are worth more than $759,750 don't qualify.

*  The program is voluntary, relying on a $75 billion subsidy to encourage mortgage companies to participate.  Lenders must agree to reduce the loan payments to 38 percent of a borrower's monthly income. After that, the government and lender split the cost of bringing the payment down to 31 percent.

*  Eligible borrowers will have to provide their most recent tax return and two pay stubs, as well as an "affidavit of financial hardship" to qualify. In the affidavit, applicants will have to cite the reasons behind their financial woes, such as job loss or a drop in income.

*  Borrowers are only allowed to have their loans modified once.  The program runs through Dec 31, 2012.

IN BANKRUPTCY OR LITIGATION

Borrowers in litigation can modify their home loans without waiving their legal rights. To get help for the modification program, call your lender or mortgage servicer. For the refinance program, find out if your mortgage is held by Fannie Mae or Freddie Mac, then contact your lender, mortgage servicer or a mortgage broker for refinancing options.

When you can get help? Both the modification and refinancing programs start immediately.

For those with FHA, VA or USDA home loans

Mortgages backed by the Federal Housing Administration, Veterans Administration or the U.S. Department of Agriculture are being modified under other programs.  The Obama administration and Congress are working on legislation that would allow modifications of these home loans consistent with the Making Home Affordable program.

AS ALWAYS, I'M HERE TO DISCUSS YOUR PARTICULAR SITUATION!