Debts-Relief

Our office is available to assist homeowners qualify for a modification under the Home Affordable Modification Program (HAMP).

If you are an owner-occupant of your home, with principal balance that is equal or less than $729,750, and cannot afford your mortgage payment due to financial hardship, you may be eligible for HAMP. If you home has more than one but equal or less than 4 units, it is also eligible if principal balance is less than a certain amount.

Not all lenders (servicers) are participating in this program, but if your loan is owned or has been guaranteed by Fannie Mae or Freddie Mac, or if your lender has agreed to participate in the program, then HAMP is available if other conditions are met.

Depending on your income, the interest can be written down to as low as 2 percent. At the servicer’s option, the term of the loan could be extended up to 40 years, and if that is still not sufficient, principal forbearance and/or principal forgiveness could also be an option.

The servicer will first determine if your mortgage payment is greater than 31 percent of your gross income, then apply a value test to determine whether it is beneficial to the investor if the loan is modified (too much equity or too low income will probably not pass this value test).

If you pass the value test and are otherwise eligible, your servicer must offer you a modification under HAMP. If you accept the offer, trial period of three months at the new payment level will commence. At the end of the trial period, your servicer may require additional documentation to ascertain the accuracy of your income and expense before a permanent modification agreement is executed.

The modified rate will be fixed for not less than 5 years as stated in your modification agreement and the rate may increase no more than one percent per year until it reaches the market rate at the time the agreement is prepared.

If your total monthly expenses is equal or more than 55% of your gross income, you also must participate in housing counseling provided by a HUD-approved counselor as a condition of getting a modification under HAMP.