Home Affordable Modification Program (HAMP) is a program initiated by the Obama administration in order to help homeowners who are employed, but are still struggling with their payments. At first there was much debate about the program within the financial and political sector, but ever since its introduction, HAMP has proven itself to be a viable option.
The ruling principle behind HAMP is simple, if underwater homeowners are presented with an option to make smaller monthly payments; they wouldn’t default and would avoid foreclosures. We have mentioned in some of our previous blogs that foreclosures are not necessarily a preferable solution for lenders either, because they end up losing money and the homes are sold for amounts lower than what the mortgagee owes them. If lowering the monthly payment means the mortgagees avoid going into default, then the lender still has a regular payment coming in every month and ends up getting the complete payment in the long run. It is a win-win situation for all parties involved.
HAMP offers several additional benefits and incentives to lenders who give loan modifications to homeowners. However, it does not force the lending institution to provide a loan modification. Following are some of the general requirements to qualify for HAMP:
- The property for which application is being submitted must be either your primary residence, or must be a property that you have rented out or intend to rent out.
- If it is a single-unit property, you must owe $729,750 dollars or less.
- You have experienced a financial hardship
- You can show the ability to make payments.
- All your financial documents must be included along with a financial hardship letter, and the application that your lender requires
Furthermore, if your request for a loan modification under HAMP was approved, and you were awarded a trial period, but cannot afford it due to your financial hardships, you may be able to re-apply for a different trial plan. .
You can download the necessary forms here, and can get a free consultation here. The loan modification and foreclosure defense attorneys at Amerihope Alliance Legal Services will be happy to answer any of your queries.
For more information visit our blog, and contact us at 877-882-5338.