Avoid Losing Your Home to Foreclosure Under HAMP Obama Plan
New legislation under United States President Barack Obama has created what is known as the Home Affordable Modification Plan, sometimes referred to by the acronym HAMP. HAMP is a modification program that is being paid for by seventy-five million dollars of economic stimulus money under the Economic Recovery Act of 2009 and was crafted to assist homeowners who are at risk of losing their home or going into default, or for those homeowners who are already in default on their mortgage loan payments. The goal of the HAMP program under Obama is to provide the homeowner with an affordable monthly payment that they can afford over the long term to help them avoid losing their homes.
Guidelines For HAMP Mortgage Refinance Approval
The government has set up standard guidelines for being approved for refinancing of a mortgage loan under the Home Affordable Modification Plan. If you can meet the guidelines, you are very likely to be approved under the program. First of all, the home that you are looking to refinance a mortgage for must be your primary residence; loans on secondary residences, vacation homes, or rental or investment properties do not qualify.
Your existing mortgage must have been taken out before January 1, 2009; loans written after that date do not qualify. The entire loan must be written for an amount of less than $729,750. Your current payment must be more than 31% of your gross monthly income, including principal interest, homeowners insurance and dues, and property taxes). (Keep in mind that gross monthly income is your take home pay, not your net earnings). You must also be able to document that you have a financial hardship that has caused you to become unable to sustain your current arrangement with your mortgage loan.
Applying For The HAMP Program
To apply for refinancing under the provisions of the HAMP program, you will need to contact your lender and let them know that you are interested in refinancing. You will need to complete an official affidavit of hardship and write an accompanying letter that documents your hardship in your own words. You must also provide financial income statements and income tax returns that detail your income and your other expenses. This includes income for all household members, including investment income and income earned by your spouse, or retirement income. You will also need to complete a borrowers statement and provide the lender with paycheck stubs, award letters, and etc. You must provide bank statements for both checking and savings accounts for the previous two months.
How To Qualify For The HAMP Program
The HAMP program is designed in a way that allows borrowers to apply and qualify directly with their existing lenders. It is important that homeowners realize that there are tons of scams that have sprung up regarding this program, and that it is unnecessary to pay any third party organization in order to qualify for HAMP assistance in refinancing. The program is absolutely free for borrowers and qualification involves applying through your lender for this special mortgage refinancing program.