| Government assistance may be available to | | | | determines the borrowers current ratio and their new |
| borrowers who are facing high, unaffordable | | | | debt ratio, after the loan workout is proposed. Here |
| mortgage payments. Obama's for homeowners is | | | | is the basic formula for determining debt ratio under |
| called HAMP-which stands for Home Affordable | | | | the government assistance plan: |
| Modification Plan. This home rescue effort is being | | | | |
| paid by $75 billion in stimulus funds, and is designed to | | | | 1. New target payment will equal 31% of the |
| help millions of borrowers avoid foreclosure. | | | | household gross income |
| Struggling with unaffordable mortgage payments? | | | | 2. Multipy the current total gross income times 31% |
| Here is a HAMP loan modification guide to quickly get | | | | to learn the new total target payment |
| you started: | | | | 3. Subtract the monthly property taxes, monthly |
| | | | homeowners insurance and monthly HOA dues to |
| 1. Learn the 5 eligibility requirements that you must | | | | arrive at the new principal and interest target |
| meet in order to apply | | | | payment |
| 2. Complete and submit an accurate and acceptable | | | | 4. If the new target payment can be reached by |
| loan modification application | | | | lowering the interest rate down to as low as 2% and |
| 3. Be sure that you provide all the needed | | | | extending the loan term out to 40 years, then the |
| documentation in your application package | | | | basic guidelines have been met |
| 4. Be diligent about following up with your lender to | | | | Homeowners wishing to apply for Obama's HAMP |
| make sure your file is moving through the process | | | | loan modification need to learn the basics of how to |
| Obama's government loan workout option has | | | | apply correctly. This can be confusing, but there is a |
| standard approval guidelines and a standard method | | | | software program designed just for borrowers that |
| used to modify home loan. These standard guidelines | | | | does all the calculations automatically and ensures |
| and methods make it easier for borrowers to learn if | | | | that the figures on the application are accurate and |
| they qualify, and also give a clue as to what is | | | | acceptable. Those homeowners who take the time |
| required when completing the application form. | | | | to learn and then submit their paperwork properly will |
| Another part of the HAMP loan modification guide | | | | have a much better chance of success. |
| explains debt ratio and how the federal plan | | | | |