If you are a Homeowner who is facing foreclosure then President Barack Obamas “Making Home Affordable” plan will help you get a home mortgage refinance or modification as well as $5,000 in additional cash incentives to assist you in making monthly mortgage payments. Here is how it works:

President Barack Obamas Housing Bailout Program Includes:

-Over $75 billion to fund home refinancings and modifications.
-A mortgage refinance program for homeowners who are up to date and have had on time mortgage payments for at least 1 year.

Here are the Top 5 Home Loan Modification questions regarding this plan:

Is it necessary that I'm delinquent on my home loan in order to be eligible for a home loan modification?

Not at all. A homeowner must prove that there is a good chance of becoming behind in their home loan payments, or that there is just not enough money coming in to make payments now. Homeowners who have high interest rates or huge balloon payments on their mortgages may benefit greatly from Obamas refinancing stimulus plan.

Do I have to be delinquent on my loan to be eligible for loan modification?

No, but borrowers must be able to show that there is a possibility of becoming delinquent on their loan or that the money coming in is not enough to make future loan payments. Those with rising interest rates or ballooning mortgage payments may benefit from Obama's Housing Bailout.

How can I know if I will qualify for a home loan modification using Obamas plan?

-The home loan must be a first mortgage. Second mortgages are not eligible under this plan.

-Homeowners that are paying over 31% of their gross monthly income towards their home mortgage.

-The home loan must not be considered a “Jumbo” loan, and should be in line with Freddie Mac and Fannie Mae standards.

-The homeowner must live in the home as a primary residence.

-All income must be verifiable through tax returns and paycheck stubs.

What if I have a mortgage that is worth more than my home?

According to the guidelines in Obamas plan. The amount that can be due on a mortgage, and still be eligible for this plan, can not exceed over 5% of the homes worth. The homeowner will still need to verify their income through tax returns and if possible pay check stubs.

How should I know whether my mortgage is guaranteed by either Fannie Mae or Freddie Mac?

The complete plan was launched early last month but the wheels have not started to really turn until the past 2 weeks or so. Homeowners can check with their current mortgage lender to find out if their home is backed by either of these 2 mortgage giants.

Is it necessary that my Mortgage Lender participates in Obamas “Making Home Affordable” plan?

No, however the Government is offering cash incentives to encourage the approval of home refinancing or modification loans. The lending companies will receive as much as $3,000 on top of their regular commissions should a homeowner refinance with them and stay in their home.

-M Petrone

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