MakingHomeAffordable
The MakingHomeAffordable.Gov website
The Federal Government under President Obama has launched a new website called www.makinghomeaffordable.gov which is designed to help America's Homeowners refinance or obtain a loan modification if they cannot afford to pay their current mortgage. The government website offers a self assessment tool that will tell you whether you are eligible for a refinance or loan modification under the Making Home Affordable plan.
Refinancing is for those who are current on their mortgage payments but are not able to refinance to a lower interest rate due to a decrease in your home value. Your loan must be through Fannie Mae or Freddie Mac to allow refinancing of your loan. You are eligible for refinancing if you own and occupy a 1-4 unit home. You must have income sufficient to support the new mortgage payments after your refinance. You can find out if your loan is through Fannie Mae by calling 1-800-7FANNIE or Freddie Mac at 1-800-FREDDIE to do a loan lookup. The new first mortgage must not exceed 105% of the value of your property so this will help those who are current but under water on their loan. You cannot receive cash out when you refinance with the MakingHomeAffordable plan.
Loan Modification may be possible if you are delinquent or late on your mortgage payments. You may however be able to obtain a Home Affordable Modification. Unlike the refinancing the loan modification program may be available to all home owners who are late on their mortgage regardless of who owns the loan. This is due to incentives given to servicers to participate in the loan modification program. To qualify for a loan modification you must have an unpaid mortgage balance of less than $729,750 and your mortgage must have originated prior to January 1, 2009. Your mortgage payment including tax, insurance must be more than 31% of your gross monthly income. You do not need to be behind on your mortgage to be eligible for a loan modification. You are eligible if you can demonstrate that you are at risk of default because your mortgage payment was risen to a level that is not affordable.