Overshadowed by the massive 800 Billion dollar bailout, the Hope for Homeowners program takes effect with little press coverage.

As part of the Economic and Housing Recovery Act of 2008, Hope for Homeowners is designed to keep struggling homeowners in their homes by offering a 30 year fixed FHA refinance option.  Eligible homeowners may have the option of refinancing their current loan @ 90% of the current appraised value of the home. 

Who Qualifies?

1. The home must be your primary residence and the homeowner can not own other real property.

2. You must have made at least 6 payments on your loan.  Qualifying loans must have been originated on or before January 1 2008

3. Unable to pay current mortgage payment without assistance

4. Mortgage payment is greater than 31% of your gross monthly income

5. No fraud convictions for 10 years.  You must have been truthful about your financial situation and not knowingly provided false information when you applied for the loan. 

The Downside?

1. The program is voluntary for your lender.  As lenders are required to accept a 10% loss on the home, accessibility to hope for homeowners will vary from lender to lender. 

2. FHA will share in your future equity.  Based on a sliding scale, you'll agree to anywhere from 100% to the minimum of 50% after 5 years.

3. Banks are still working on how to best implement the program and it may be several more months before they begin to utilize it. 

Information about Hope for Homeowners, for borrowers with a Countrywide mortgage can be found on BoA's website.

To learn more about Hope for Homeowners visit HUD's website.