HAMP:  An Overview
The Home Affordable Modification Program (HAMP) is a government sponsored mortgage 
modification program that may allow homeowers to stay in their homes.  HAMP allows eligible participants to lower their mortgage payment to 31% of their gross income.  They payment includes principal, interest, property taxes, and insurance. 

Qualifications for HAMP:

The property must be used as your homestead or rental property.  Vacations and second homes are not eligible for HAMP modifications.

You obtained your mortgage on or before January 1, 2009.

The home must be 1 to 4 units. (i.e. duplexes and triplexes are eligible for HAMP).

The loan amount cannot exceed the current Fannie Mae and Freddie Mac loan limits, which

is currently $729,750 for a single family residence, $934,200 for a duplex,
$1,129,250 for a triplex, or $1,403,400 for a fourplex.

The property has not been condemned.

You must not have been convicted within the last 10 years of felony larceny, theft, fraud, forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction.

You have a financial hardship and are behind on your payments or in danger of falling
behind on your payments. (If you are applying for HAMP for your rental property, your must be behind on your payments).

You must have income sufficient to modify the loan.  Income can be in the form of employment, self-employment, unemployment benefits, disability, social security income, rental income, or a 
combination of any of the above.

Your lender must participate in HAMP.  All loans owned by Fannie Mae and Freddie Mac are required to participate in HAMP. Loans that are not owned by Fannie or Freddie can still participate in HAMP.  Click this link to find lenders currently participating in HAMP.  Click this link to see if your loan is owned by Fannie Mae.  Click this link to see if your loan is owned by Freddie Mac. This list changes frequently.

Recent Changes to HAMP
In June of 2012, the government expanded the eligibility requirements to participate in HAMP.  You can now reapply for HAMP if you fall under these categories:

 You were previously denied for HAMP because your income to debt ratio was below 31%.

You qualified for HAMP but defaulted on your payments during the trial period.

Your HAMP modification was accepted but you defaulted on the regular HAMP payment.

The Application Process

Fill out the application for HAMP modification.  Contact your lender and ask them for a HAMP
modification packet.  If they are taking too long, contact a HAMP Housing Counselor to assist
you with the process.  These counselors are free.  You can also contact an attorney to fill out the packet.  Attorneys will charge you for the service but might get your packet approved faster depending on their case loads.

If the lender approves you for HAMP, you will make three trial payments.  If you pay them on time, the lender will send you closing documents to finalize the modification.  Your mortgage will be modified for 30 to 40 years.  The interest rate will not change the first five years.  After
that, it will increase by 1 per cent.  There are no closing fees for HAMP and you do not need to pay the arrears (the amounts that you are behind) in order to qualify. The arrears will be added to the back of your loan. 

HAMP does not guaranty principal reduction but it does allow for it.

Give your lender two to three weeks to process your loan.  After two to three weeks, call or e-mail your lender every week for weekly updates.  If you do not follow up on this step, your loan
will likely be lost.  If the lender still won't communicate with you, contact your housing counselor for further assistance.

Click this link for updated information on HAMP and changes to HAMP

If you are looking for a mortgage modification attorney in Naples, call the Rothrock Law Firm
at (239) 206-1948.


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