Making Home Affordable Program


Making Home Affordable Refinance Program

The main goal of Obama administration is to provide financial stability for the recession hit housing market and struggling home owners to save their homes from foreclosure. To make this happen, the federal government has undertaken a comprehensive approach using the state as well as local housing initiatives. Several initiatives included in the making home affordable program such as tax credit benefits for homebuyers, neighborhood stability and community development programs, mortgage modification and refinancing, and extended support to Fannie Mae and Freddie Mac aim to improve the local market conditions, and make it possible for American citizens to lead a stress free life. From the homeowners and their existing mortgages point of view, the main objective of the administration is to give opportunities to householders finding it difficult to remain current on their mortgages or possibly facing a foreclosure to keep their households intact by saving their homes. Owing to a large participation in these reforms based programs and plans by private and federal credit providers and lenders, approximately more than four million homeowners have benefited by modifying or refinancing their mortgages to make them more affordable to redeem. The federal government has come out with two main types of home saving programs – the home affordable modification program (HAMP), and the home affordable refinance program (HARP). In addition, several other federal making home affordable programs aid home owners in making their existing mortgage more affordable by taking second liens or avoiding foreclosures through forbearances.

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Home Affordable Refinance Program HARP

Main objectives of Making Home Affordable Program

The federal government reforms consist of the following initiatives:


  1. The home affordable modification program

    2. Avoid foreclosures and save your home.


  2. The home affordable refinance program

    3. Meant for responsible home owners current with their mortgages to avoid the negative effects of falling home prices and avail affordable mortgage refinance rates.


  3. A comprehensive $75 billion funding to promote
    • Loan modification plans
    • Consistent and clear guidelines for all loan modification programs and plans
    • Mandatory participation of participants associated with the making home affordable program and financial stability plans
    • Modification of home mortgage loans even during bankruptcy
    • Provide tailor made and affordable mortgage credit facilities to struggling home owners through FHA loan programs
    • Local community support and re-allocation of displaced renters

  4. Provide highly reduced mortgage rates from Fannie Mae and Freddie Mac


Eligibility for the Making Home Affordable Program

The eligibility as per making home affordable program guidelines consists of:


  • All loans and mortgage related credit facilities should have been availed on or before January 1, 2009.
  • The mortgage i.e. the home should be self owned and the applicant must be residing in it.
  • In case a first lien has been taken on the mortgage, the unpaid principal balance should not be more than $729,750. For 2 – 4 unit properties the limits are higher.
  • The applicants have to produce all income related documents such as IRS 4506-T form, most recent tax returns, two most recent salary slips or pay stubs, and an affidavit in the form of a hardship letter containing at least 3 factors indicating financial hardship and inability to redeem the existing mortgage.
  • Property ownership and occupancy status to be verified through the credit report and other occupancy related documentation.
  • The mortgage should not be investor owned.
  • The home should not be vacant.
  • The property should not be condemned.
  • Modification can only be carried out once.

Home Affordable Refinancing Program (HARP)

Many home owners are regular with their monthly mortgage payments, but are not able to benefit from home affordable refinance and reduced home affordable refinance rates because the market value of their homes have decreased. If the home owner has availed his or her mortgage loan from Fannie Mae or Freddie Mac, it’s possible to avail reduced interest rates for your mortgage, and affordable monthly repayments.

Home Affordable Modification Program (HAMP)

For those home owners who’re struggling with their monthly mortgage payments, a foreclosure might be unavoidable if they consistently remain delinquent with their mortgage payments. For such individuals the best way of stopping a foreclosure and availing affordable repayment terms would be to obtain HAMP and benefit through the forbearance option to save their homes.

Second Lien Modification Program (2MP)

At times mortgage holders having a second lien on their existing mortgages may find it very difficult to make their mortgage payments. The making home affordable second lien program helps the home owner to benefit from lowered second lien monthly payments while the primary mortgage is modified under HAMP.

Home Affordable Foreclosure Alternatives (HAFA)

Home owners who don’t have enough resources and feel they can’t afford to keep their homes any longer can avoid the negative effects of a foreclosure through the HAFA program. The program offers $3000 to the home owners and helps them in their transition from their existing homes to more affordable dwellings after they complete a short sale or a deed-in-lieu of foreclosure.


Other plans available under Making Home Affordable Program

The federal government and U.S. treasury has announced three additional plans or programs to support the Making Home Affordable plan initiative:


  • Support for “hope for homeowners”

    • For underwater borrowers to write off more principal amount.


  • Short Sales / Deeds-in-Lieu Program

    • For avoiding the negative effects of foreclosure and stopping it from being imposed.


  • Home price decline protection

    • To promote modifications in market segment which is affected the most by falling home prices.


What to do now?

The making home affordable program has a lot to offer, and you need to choose whether to avail the modification facilities or refinancing options. For a free non-binding consultation and mortgage related help please provide us your contact details by filling our online application form so our mortgage attorney can call you as per your convenience and time.