Are You Wondering If Your Loan is Eligible Under the Home Affordable Modification Program, AKA HAMP?

Is wondering if your loan is eligible under the home affordable modification program - AKA HAMP, keeping you awake at night?

Are you facing foreclosure? Is the whole process keeping you awake all night with fear, anxiety and stress? Nothing is worth affecting your health and inner peace.

There are a few characteristics you must have to be eligible for this plan. Do you know if your loan's investor is Fannie Mae or Freddie Mac? Many lenders have HAMP like guidelines for other in-house programs so do not fear if your loan is not owned by Fannie Mae or Freddie Mac.

- The first mortgage loan amount must be at or under $729,500
- You must have taken out your loan prior to Jan 1, 2009
- You must have a verifiable hardship
- The property must be owner occupied
- Property must be between 1 and 4 units

Next you need to know exactly how much your total PreTax (gross) income is - they will use a percentage of 31% that will be the basis of your NEW MODIFIED PAYMENT including mortgage payment for your first loan only, property taxes, homeowners insurance, and Homeowners Association dues - The total MODIFIED mortgage payment CANNOT exceed 31% of your gross income.

To arrive at the modified payment the first step will be for your lender to extend the term of your mortgage to 40 years in order to lower the payment - if this is not enough to get your payment to 31% then:
They may lower your rate down to: as low as 2% start rate (usually for 5 years) if this is not enough the last step will be to then:

At the lenders discretion they may (only a very low percentage of lenders will do this, do not have high expectations of this because most likely you will be let down) the lender may defer some of the balance and not charge interest on a portion of the balance, payable when you refinance, at the end of the term of the mortgage, or upon sale or refinance. If your maximum payment did not get to 31% of your gross income using step 1 and 2 and your lender does not subscribe to deferring principle then your HAMP loan modification request can possibly qualify for another internal program, or denied, if denied then you need to increase your income, try to lower your insurance and property taxes, if possible and then reapply and let your lender know you have new information to submit. Keep your timeline in mind at all times and don't forget to write down names, departments, and dates.

Keep this example in mind - let's say your gross income is $2000 per month x 31% is $660 - if your homeowners insurance and taxes are $500 your lender is NOT going to give you a $160 payment to arrive at the $660 maximum total modified payment- so it is important to be realistic and work out your numbers. Work on finding opportunities to increase your income if it is too low to qualify or you if you have been denied - Ask questions and get the exact detailed numbers they used and the reason for your denial. This way you can reapply when you can increase your income.

They do not use your expenses or credit card debt into these figures (called ratios) but if you carry a large credit debt load you will be referred to credit counseling- I would also suggest debt settlement if you are already late on your other bills as well.

My advice is to please be prepared to be patient, yet commit to a positive mindset and commit to not give up and make the calls, take the action, and do the work if you are going to do this yourself you need to be your own advocate and provide yourself with first class customer service. This means get yourself organized and go above and beyond even if it takes a few no's to get to the yes. Analyze your financial situation, make the necessary cutbacks, make a commitment to give this your all and that means to work on your mindset and remain as calm as possible so you can be successful at modifying your own mortgage loan. With Faith, persistence, conviction, and determination anything is possible - Don't give up. Short Sale is not your only option.

The worst thing you can do is to do nothing.

By: Anna Cuevas; A Loan Mod Guru

Anna Cuevas
Consumer Advocate/Expert Trainer on how to Successfully Modify Mortgages & SAVE Homes with the right mindset and knowledge/Loan Modification Guru.

Proven Record of Achievement: Modified over 110 loans including Sale Reversals. Real Expert advice from someone who has actually personally modified loans with just about every lender. Insider tips and knowledge. My expertise can empower others during the housing crisis w/insider tips, process, & knowledge.

Got an experience or comment to share? Visit us today and Sign up to get your FREE Mortgage Loan Modification Assistance Special Report on How to Modify My Loan & Save My Home here: http://www.askaloanmodguru.com

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