Tipping the Scales Toward Foreclosure?
Current estimates from RealtyTrac reveal that close to 7.5 million American households are delinquent on their mortgage or in foreclosure. An additional 11 million homeowners owe more on their mortgage than their homes are worth. Are you one of them?
While there are numerous programs offering help to homeowners in trouble, deciphering them all can be difficult. Here is a brief overview of those you’ll be hearing about most often in this election year:
The Home Affordable Foreclosure Alternatives program helps homeowners avoid the negative effects of foreclosure by establishing incentives for completing a short sale or deed-in-lieu of foreclosure. With a successful short sale or deed-in-lieu, HAFA provides for $3,000 in relocation assistance for the homeowner. The property and the homeowner must meet qualification standards to participate in this program.
The Home Affordable Modification Program helps homeowners who are no longer able to make mortgage payments due to decreased income or increased payments. HAMP reduces the monthly mortgage payment to 31% of gross income by following steps that can include interest rate reduction, extension of the term of the loan, deferring principal payments and even possible reduction of principal.
The Home Affordable Refinance Program helps homeowners refinance and take advantage of today’s historically low interest rates. The mortgage must be backed by Fannie Mae or Freddie Mac to qualify for the program. As of December 1, 2011, a previous requirement that the first mortgage didn’t exceed 125% of the market value of the home has been eliminated. Eligible borrowers may now refinance under HARP regardless of how “underwater” they are. Find out if your loan is backed by Fannie Mae or Freddie Mac.
Each month we publish a special report just for distressed homeowners. You can always see the current report by visiting ForeclosureOptionsToday.com and see all the archives at the Resources tab. We’re here to help.