Homeowners who are facing foreclosure or are struggling for help refinancing or modifying their home mortgage and looking to take advantage of President Obamas “Home Affordability Plan” mortgage stimulus, may be confused about which part of they plan they qualify for. Here is some help.

With so many announcements from the news and government themselves about the stimulus bailout and how homeowners can save a lot of money by refinancing a lot of homeowners ask themselves where to start. Here is some helpful information to get you on your way.

1)The Fannie Mae and Freddie Mac SMP (Streamlined modification program) is a home loan modification option for homeowners who have a mortgage owned or insured by Freddie Mac or Fannie Mae. This mainly applies to conforming loans and will reduce the monthly mortgage payments to no greater than 38% of the homeowners gross monthly income. Interest rates will be lowered to as little as 3% in order to achieve this goal as is extending the length of the loan. However, there are some minimal qualifications that must be met in order to take this route that you can learn more about.
2)The partial claim FHA mortgage loan modification is also an option for homeowners who have a home loan insured by the FHA. Using this program, a “silent” additional loan is used to bring the existing home loan up to date and current. No payments or interest will be paid on this loan until the house is sold or the home loan is refinanced.
3)Qualified homeowners can apply for loan modification programs or refinancing options through their lender, or any lender or bank, in order to lower their monthly mortgage payment. This can be done through lower interest rates, a longer loan term. Forbearing the principal, or a combination of all three of these things. Each mortgage lender and bank have eligibility requirements for each type of home loan refinance or modification. Learn the lenders requirements in order to better your chance of being approved.

Millions of homeowners across the country are facing foreclosure or defaulting on their home loan. This mortgage stimulus plan from President Obama makes refinancing a mortgage easier than ever and will save an estimated 9 million homeowners a lot of money every month. Take advantage of this amazing time to refinance and talk to your mortgage lender or bank today.

-M Petrone

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