Aug 12 2010

Unemployed? The New HAMP Loan Modification Program Might Help You Keep Your House

HAMP

If you’re unemployed and can no longer afford your mortgage, a new Making Home Affordable loan modification program might offer some relief.

The new Unemployed Program (UP) starts August 1, 2010, and it requires lenders to reduce or suspend payments for at least three months for eligible borrowers. It is at the lender’s discretion to extend the forbearance, and the program ends once the borrower gets a new job.

According to Supplemental Directive 10-04, mortgage servicers are required to offer an Unemployment Program forbearance plan to a borrower who meets the following criteria:

1. The mortgage loan is secured by a one- to four-unit property, one unit of which is the borrower’s principal residence.

2. The mortgage loan is a first-lien mortgage originated on or before January 1, 2009.

3. The current unpaid principal balance of the mortgage loan is equal to or less than $729,750 for a single-family property. Higher loan amounts apply to two- to four-unit dwellings.

4. The mortgage is delinquent or default is reasonably foreseeable.

5. The mortgage loan has not been previously modified under the Home Affordable Modification Program (HAMP) and the borrower has not previously received an UP forbearance period.

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