In this article I would like to discuss Obama’s Mortgage Loan Modification Program that is the part of the Home Stimulus Bill. The central point about this program is that it aids qualified homeowners to stay away from foreclosure and stay in their homes. Needless to say that the economic troubles in the country and in the whole world have made lots of persons understand they very need to have their mortgage adjusted (adjustable rate mortgage)to keep from losing their home to foreclosure.
Let’s start with that an individual start looking for a reworked mortgage as a result of 2 major reasons. The primary motivation is that a person is facing foreclosure. So, you can easily understand why it is important – since with loan modification you get a lower interest rate, a longer term, and possibly a reduced loan principal. Another variant to receive the same above advantages is mortgage refinancing.
The other significant thing for you to take into account is that reworking a mortgage can be quite a advantageous thing for persons who are under financial stress for the reason that their budget is tight. The point is that this person may not yet be in default, but the house payment is a main source of concern each month. As you can realize, in this way this person is trying to prevent foreclosure beforehand.
And now let’s concentrate on the basic criteria for eligibility to Obama’s mortgage loan modification program:
First you should consider that your home must be your primary residence for the reason that mortgage loan modification is only available on the property you in fact live in. The next point for you to pay your attention to is that your outstanding mortgage balance cannot be more than $729,750 and in other words it simply means that if your loan is equal to or less than this figure, you have the opportunity to be approved for mortgage loan modification.
The third vital aspect you need to keep in mind is that it is also essential for you to prove that you are having trouble meeting your current monthly mortgage payments. For this point a financial hardship letter is required. There you will explain your circumstances such as: the mortgage payment has raises notably; the income became smaller since you took the loan out; the expenses have boosts lately, due to some kind of unforeseen expenses. You need also to keep in mind that you must have taken out your current mortgage before January 1st 2009 to qualify for mortgage loan modification and it should be mentioned that if your case is that your loan was approved after this date, you are no longer eligible.
The last but not least thing for you to take into account is that you should ask yourself whether all the payments are associated with your mortgage greater than 31% of your monthly earnings and if this is your case then you are eligible.