Need a Housing Bailout?

If you are looking for housing relief the Government has made the process a little bit easier. You can reduce your housing payment by either refinancing your Mortgage or by obtaining a Loan Modification using the funds from two stimulus packages: The Home Affordable Refinance Program & The Home Affordable Modification Program. There is over $75 Billion allocated to these programs to keep Americans in their homes.

The website set up by the Government to determine if you will qualify for the Housing Bailout and to provide assistance in helping Americans stay in their homes is:

www.makinghomeaffordable.gov

At this site you will be able to determine if you qualify for a Mortgage Refinance or a Loan Modification. To know if you qualify for one of these two programs you will need to answer 5 simple questions to see if you qualify for a refinance of your existing mortgage or if you are able to obtain a loan modification. Once at the site, click on ‘Eligibility’
The questions pertain to the following:

• To see if you are behind on your payments

• If you have bad credit

• To determine if you are payment on your mortgage is 31% of your gross income

• The value of your home compared to the current mortgage balance.

Refinance

If you qualify for the refinance you can reduce the interest rate on your home mortgage, thereby saving several hundred dollars a month on your mortgage payment. Make sure that you understand all the fees that are involved in the refinance and the new term of your mortgage. Many times people put forth a great deal of effort to refinance, lowering the rate on their mortgage but don’t realize that the term resets their term and the fees they paid to obtained the refinance add to their loan so when the dust settles they are in the same position they were 2 years earlier (just with a lower rate). With that said, refinancing is a tremendous tool to help reduce your monthly mortgage payment but make sure you understand your new loan.
Loan Modification
In the Loan Modification process the borrower and lender negotiate the terms of the mortgage. Now with the stimulus package the Government if providing the support to assist and give financial support to help in the modification process. Several areas of mortgage modification are as follows:

• Reduction in interest rate, or a change from a floating to a fixed rate, or in how the floating rate is computed

• Reduction in principal

• Reduction in late fees or other penalties

• Lengthening of the loan term

• Capping the monthly payment to a percentage of household income

By successfully completing a Loan Modification on your mortgage you can be able to reduce your mortgage payment by a hundreds of dollars or even thousands of dollars.
If you are struggling to make your mortgage payment, definitely consider the assistance provided by the Government through their plan to save the U.S. Housing Market.