Vail, CO Colorado
In the first part of this series we identified the Making Home Affordable Act, the Obama Administration's initiative to help struggling homeowners get mortgage relief through mortgage modifications, interest rate reductions, refinancing, deferred payment or transitioning out of your home while avoiding foreclosure. We discussed, specifically, the Home Affordable Modification Program, the Second Lien Modification Program, and the Principal Reduction Alternative.
In this column, we will look at other aspects of the Making Home Affordable Act including: the FHA-HAMP, the VA-HAMP, the USDA-HAMP; Home Affordable Foreclosure Alternatives, the Home Affordable Refinance Program, and the Home Affordable Unemployment Program.
The FHA-HAMP and the VA-HAMP programs are mortgage modification programs which may be available to struggling homeowners with FHA, VA and USDA mortgages. The programs are designed to lower monthly mortgage payment to no more than 31 percent of the homeowner's verified monthly gross (pre-tax) income, potentially making monthly mortgage payments more affordable. If you have a loan that is insured or guaranteed by the Federal Housing Administration or Veterans Administration, you may be eligible for these programs which are offered through those government agencies. For this and other MHA programs, you may contact a Housing and Urban Development counselor at 888-995-HOPE (4673).
Similarly, if you have a loan that is guaranteed by the United States Department of Agriculture's Section 502 Single Family Housing Guaranteed Loan Program, you may be eligible for a program through that to lower your monthly mortgage payment to no more than 31 percent of your verified monthly gross (pre-tax) income. You may wish to contact your loan servicer for more information.
If you can't afford your mortgage and it's time to transition to more affordable housing, the Home Affordable Foreclosure Alternatives program may be just the ticket.
HAFA provides two options for transitioning out of your mortgage: a short sale or a Deed-in-Lieu of foreclosure. In a short sale, the mortgage company agrees to let you sell your home for an amount that falls “short” of the amount you still owe. In a DIL, the mortgage company agrees to take the title back, transferring ownership back to the mortgage lender. In either case, HAFA offers benefits that make the transition as favorable as possible. In addition to advice available from HUD counselors and real estate professionals, HAFA's benefits include: unlike in a conventional short sale, a HAFA short sale completely releases you from your mortgage debt after selling the property. This means you will no longer be responsible for the amount that falls “short” of the amount you still owe. The deficiency is guaranteed to be waived by the servicer; in a HAFA short sale, your mortgage company works with you to determine an acceptable sale price; HAFA has a less negative effect on your credit score than foreclosure or conventional short sales; and when you close, HAFA provides $3,000 in relocation assistance. Perhaps not cause to kick up your heels, but better than it could be and better than it would be without HAFA.
You may be eligible for HAFA assistance if: you live in the home or have lived in the home within the last 12 months; you have a documented financial hardship; you have not purchased a new home within the last 12 months; your first mortgage is less than $729,750; you obtained your mortgage on or before January 1, 2009; and you have not 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.
HARP, the Home Affordable Refinance Program is designed for those who are not yet behind on their mortgage payments but have been unable to get traditional refinancing because the value of the home has declined. HARP may be available to help you get a new, more affordable, more stable mortgage. HARP refinance loans require a loan application and underwriting process. Refinance fees will apply.
You may be eligible for HARP if all of the following apply: the mortgage is owned or guaranteed by Freddie Mac or Fannie Mae (see the first part of this series for an explanation of these programs); the mortgage was acquired by Fannie Mae or Freddie Mac on or before May 31, 2009; the mortgage cannot have been previously refinanced under HARP (unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009); the current loan-to-value (LTV) ratio must be greater than 80 percent; and the borrower must be current on the mortgage at the time of the refinance, with a good payment history for the past 12 months.
The Home Affordable Unemployment Program is intended to address those who are unemployed. Depending on your particular circumstances the UP may be available and may reduce your mortgage payments to 31 percent of your income or suspend them altogether for 12 months or even more.
To be eligible for the UP, you must meet all of the following criteria: you must currently be unemployed and eligible for unemployment benefits; you occupy the home as your primary residence; you have not previously received a HAMP modification; you obtained your mortgage on or before January 1, 2009; and you owe not more than $729,750 on your home.
There are other, perhaps slightly more esoteric MHA programs as well that include the Home Affordable Modification Program for Rural Development Loans (“RD-HAMP”), the Second Lien Modification Program for Federal Housing Administration Loans (“FHA-2LP”), and the Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets (“HHF”), all of which may afford at least some relief depending upon the particulars of your situation.
In any event, if the housing market has struck hard and you are at your wits end, don't just sit there. Relief may be just a phone call away. Call your lender and call a HUD counselor at 888/995. HOPE (4673). It may be one of the smartest things you'll ever do.
Rohn K. Robbins is an attorney licensed before the bars of Colorado and California who practices in the Vail Valley. His practice areas include business and commercial transactions, real estate and development, homeowners' associations, family law and divorce and civil litigation. He may be heard on Wednesdays at 7 p.m. on KZYR radio (97.7 FM) and seen on ECOTV 18 as host of “Community Focus.” Robbins may be reached at 970-926-4461 or at his email address, robbins@colorado.net.
In this column, we will look at other aspects of the Making Home Affordable Act including: the FHA-HAMP, the VA-HAMP, the USDA-HAMP; Home Affordable Foreclosure Alternatives, the Home Affordable Refinance Program, and the Home Affordable Unemployment Program.
The FHA-HAMP and the VA-HAMP programs are mortgage modification programs which may be available to struggling homeowners with FHA, VA and USDA mortgages. The programs are designed to lower monthly mortgage payment to no more than 31 percent of the homeowner's verified monthly gross (pre-tax) income, potentially making monthly mortgage payments more affordable. If you have a loan that is insured or guaranteed by the Federal Housing Administration or Veterans Administration, you may be eligible for these programs which are offered through those government agencies. For this and other MHA programs, you may contact a Housing and Urban Development counselor at 888-995-HOPE (4673).
Similarly, if you have a loan that is guaranteed by the United States Department of Agriculture's Section 502 Single Family Housing Guaranteed Loan Program, you may be eligible for a program through that to lower your monthly mortgage payment to no more than 31 percent of your verified monthly gross (pre-tax) income. You may wish to contact your loan servicer for more information.
If you can't afford your mortgage and it's time to transition to more affordable housing, the Home Affordable Foreclosure Alternatives program may be just the ticket.
HAFA provides two options for transitioning out of your mortgage: a short sale or a Deed-in-Lieu of foreclosure. In a short sale, the mortgage company agrees to let you sell your home for an amount that falls “short” of the amount you still owe. In a DIL, the mortgage company agrees to take the title back, transferring ownership back to the mortgage lender. In either case, HAFA offers benefits that make the transition as favorable as possible. In addition to advice available from HUD counselors and real estate professionals, HAFA's benefits include: unlike in a conventional short sale, a HAFA short sale completely releases you from your mortgage debt after selling the property. This means you will no longer be responsible for the amount that falls “short” of the amount you still owe. The deficiency is guaranteed to be waived by the servicer; in a HAFA short sale, your mortgage company works with you to determine an acceptable sale price; HAFA has a less negative effect on your credit score than foreclosure or conventional short sales; and when you close, HAFA provides $3,000 in relocation assistance. Perhaps not cause to kick up your heels, but better than it could be and better than it would be without HAFA.
You may be eligible for HAFA assistance if: you live in the home or have lived in the home within the last 12 months; you have a documented financial hardship; you have not purchased a new home within the last 12 months; your first mortgage is less than $729,750; you obtained your mortgage on or before January 1, 2009; and you have not 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.
HARP, the Home Affordable Refinance Program is designed for those who are not yet behind on their mortgage payments but have been unable to get traditional refinancing because the value of the home has declined. HARP may be available to help you get a new, more affordable, more stable mortgage. HARP refinance loans require a loan application and underwriting process. Refinance fees will apply.
You may be eligible for HARP if all of the following apply: the mortgage is owned or guaranteed by Freddie Mac or Fannie Mae (see the first part of this series for an explanation of these programs); the mortgage was acquired by Fannie Mae or Freddie Mac on or before May 31, 2009; the mortgage cannot have been previously refinanced under HARP (unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009); the current loan-to-value (LTV) ratio must be greater than 80 percent; and the borrower must be current on the mortgage at the time of the refinance, with a good payment history for the past 12 months.
The Home Affordable Unemployment Program is intended to address those who are unemployed. Depending on your particular circumstances the UP may be available and may reduce your mortgage payments to 31 percent of your income or suspend them altogether for 12 months or even more.
To be eligible for the UP, you must meet all of the following criteria: you must currently be unemployed and eligible for unemployment benefits; you occupy the home as your primary residence; you have not previously received a HAMP modification; you obtained your mortgage on or before January 1, 2009; and you owe not more than $729,750 on your home.
There are other, perhaps slightly more esoteric MHA programs as well that include the Home Affordable Modification Program for Rural Development Loans (“RD-HAMP”), the Second Lien Modification Program for Federal Housing Administration Loans (“FHA-2LP”), and the Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets (“HHF”), all of which may afford at least some relief depending upon the particulars of your situation.
In any event, if the housing market has struck hard and you are at your wits end, don't just sit there. Relief may be just a phone call away. Call your lender and call a HUD counselor at 888/995. HOPE (4673). It may be one of the smartest things you'll ever do.
Rohn K. Robbins is an attorney licensed before the bars of Colorado and California who practices in the Vail Valley. His practice areas include business and commercial transactions, real estate and development, homeowners' associations, family law and divorce and civil litigation. He may be heard on Wednesdays at 7 p.m. on KZYR radio (97.7 FM) and seen on ECOTV 18 as host of “Community Focus.” Robbins may be reached at 970-926-4461 or at his email address, robbins@colorado.net.
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