Qualifying For A Loan Modification Plan
by
Tracey
Availing a loan modification plan has become difficult these days. No one thought that the action of foreclosure would back fire and adversely affect the housing market. The current recession, hike in the commodity prices, rise in the rate of interest of current debt, and income reduction compelled many indebted homeowners to skip the monthly payments to their creditors or lenders who finally foreclosed their homes. This had a negative effect on the housing market and culminating into the depreciation of the property. Now the situation is such that the debt of many indebted homeowners exceeds the appraised value of the house.
Availing the loan modification program through a lender would have been easy if the properties had appreciated. The depreciation of property has brought the housing market nearly to a standstill and no lender is ready to offer loan modification to the indebted homeowners. Most of the indebted homeowners sought home loan modification to reduce the monthly payment because taking into consideration the current financial circumstances, the monthly payments that were once upon a time affordable, are now exorbitant. Most of the lenders have closed their doors to loan modification. The Obama administration has come to the rescue of the panic stricken home owners by putting forth them the Obama Federal loan modification program. This program comes as a much awaited respite for the debt struck home owners.
Benefits Of Obama home loan modification program
Some of the benefits of this program are reduction in the monthly payment, reduction in the rate of interest, and saving the house from being foreclosed by the creditors or lenders. If you qualify for the Obama home loan modification program the loan can be extended to a maximum terms of 40 years and the monthly payment is going to get drastically reduced giving you a chance to be current on the monthly payment and improve your credit score.
Qualifying for Obama home loan modification program
Qualifying for the Obama federal loan modification program is not a cake walk and never be easy without professional assistance from a reputed service provider or lender. The Obama administration has set aside a fund of $75 billion to promote and assist the availability of this program. This money is going to be offered as incentives for the borrowers who are going to be regular at monthly payments and for the lenders who bring the regular monthly payment payers under the umbrella of this program. Some of guidelines for qualifying for this loan modification program are as follows:
1.The balance loan should not exceed the sum of $729,750
2.The house should be the principal residence of the applicant and neither for investment purpose and nor as vacation home.
3.The first loan should have originated before January 1, 2009
4.The present mortgage monthly payment should be equal to or more than 31% of the gross income of the applicant. The gross income includes the insurance, taxes and charges paid for homeowners association
5.The applicant should not be a part of active bankruptcy
It is better if the applicant is not delinquent on the current loans. For applying for this loan modification program the applicant should submit the filled up application form along with the documents such as the copies of filed tax returns, income proof and other necessary documents.
For more information about the
Federal Loan Modification Program
and other home modification resources, Visit us at
Refinanceitt.com
.
Article Source:
eArticlesOnline.com
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