Making Home Affordable

The latest on the Making Home Affordable program

The Treasury Department announced their latest effort to help homeowners modify or refinance their mortgage. After several weeks of working on the details of the Making Home Affordable program, the government released their general guidelines today. Many analyst believe California mortgage holders will benefit the most and those in serious risk of default, may be able to refinance under this latest effort to prevent foreclosures. Because of the declining home values, in places like California, many homeowners owe more then their property is worth. And with state unemployment above 10%, some homeowners are not able to keep up with their high payments. The Making Home Affordable program is designed to help those that need immediate help.

At RefinanceQT.com we are here to help and assist you with your next refinance or purchase. Call us today to obtain additional details about the Make Home Affordable program. Homeowners in California need to act quickly as the program will not last for ever. With interest rates at historic lows, you might be able to save thousands of dollars a year off your current mortgage payment. Under this program, the government requires the homeowner to take a new 30 year fixed rate mortgage or a 15 year fixed rate mortgage. No adjustable rate mortgages are allowed.

U.S. DEPARTMENT OF THE TREASURY

Washington

March 4, 2009

Making Home Affordable

Summary of Guidelines

Making Home Affordable will offer assistance to as many as 7 to 9 million homeowners, making their mortgages more affordable and helping to prevent the destructive impact of foreclosures on families, communities and the national economy.

The Home Affordable Refinance program will be available to 4 to 5 million homeowners who have a solid payment history on an existing mortgage owned by Fannie Mae or Freddie Mac. Normally, these borrowers would be unable to refinance because their homes have lost value, pushing their current loan-to-value ratios above 80%. Under the Home Affordable Refinance program, many of them will now be eligible to refinance their loan to take advantage of today's lower mortgage rates or to refinance an adjustable-rate mortgage into a more stable mortgage, such as a 30-year fixed rate loan.

GSE lenders and servicers already have much of the borrower's information on file, so documentation requirements are not likely to be burdensome. In addition, in some cases an appraisal will not be necessary. This flexibility will make the refinance quicker and less costly for both borrowers and lenders. The Home Affordable Refinance program ends in June 2010.

The Home Affordable Modification program will help up to 3 to 4 million at-risk homeowners avoid foreclosure by reducing monthly mortgage payments. Working with the banking and credit union regulators, the FHA, the VA, the USDA and the Federal Housing Finance Agency, the Treasury Department today announced program guidelines that are expected to become standard industry practice in pursuing affordable and sustainable mortgage modifications. This program will work in tandem with an expanded and improved Hope for Homeowners program.

With the information now available, servicers can begin immediately to modify eligible mortgages under the Modification program so that at-risk borrowers can better afford their payments. The detailed guidelines (separate document) provide information on the following:

Eligibility and Verification

Loans originated on or before January 1, 2009.
First-lien loans on owner-occupied properties with unpaid principal balance up to $729,750. Higher limits allowed for owner-occupied properties with 2-4 units.
All borrowers must fully document income, including signed IRS 4506-T, two most recent pay stubs, and most recent tax return, and must sign an affidavit of financial hardship.
Property owner occupancy status will be verified through borrower credit report and other documentation; no investor-owned, vacant, or condemned properties.
Incentives to lenders and servicers to modify at risk borrowers who have not yet missed payments when the servicer determines that the borrower is at imminent risk of default.