In the past, homeowners used to be left to handle everything themselves relating to saving their home from foreclosure and eventual lose. The $1000 incentive offered by the Obama administration to homeowners at a time shows how the government is committed to helping out in terms of loan modification service. With the various government interventions, homeowners now have a sigh of relief knowing that the government has set out various programs to work along with lenders for their safety. We’ll look at a few of the government programs in this regard.
The FHA short refinance program
The federal housing administration has provided this program to help the non-FHA homeowners get out of financing problems. This program sees to give a federal housing administration insured loan scheme to help the distressed homeowners retain their homes. To be eligible for the program:
- The said property must be the primary residence of the borrower.
- The credit score of the borrower must not be less than $500
- The lender must agree to let go of 10% of the remaining balance
- The remaining balance should be more than the present worth of the house
- The service participation agreement with Fannie Mae should have been done.
The home affordable modification program (HAMP)
This is another initiative taken by the government to help homeowners save their homes. This is a government regulation to ensure banks and lenders work out a good modification process for homeowners to keep their homes. The program has guidelines that you can access to know if you would qualify or not. Lenders have ways to determine if a borrower qualifies or not for the modification.
The HARP program is closely related to the HAMP and also has been helpful in this regard. Programs like HAMP are about winding up anytime soon. You can consult your loan modification consultant to decide on which would be good for you.