Home Mortgage Foreclosure

There is a new federal program called Hope for Homeowners Act . It  began in October and is focusing on helping  those debtors that are  unable to pay their mortgages.  It is estimated that almost 400,000 homeowners could avoid foreclosure through this program within the next three years.
This program will help to refinance mortgages for borrowers who are having difficulty making their payments, but can afford a new loan insured by HUD’s Federal Housing Administration (FHA).
The primary way homeowners will participate in the program is by working with their current lender and/or  by refinancing your loan into a new 30-year fixed rate loan with lower payments.

Who is eligible to participate in  this program?

Only owner-occupants who are unable to afford their mortgage payments are eligible for the program. No investors or investor properties will qualify. Homeowners must certify, under penalty of law, that they have not intentionally defaulted on their loan to qualify for the program and must have a mortgage debt to income ratio greater than 31 percent as of March 1, 2008. Lenders must document and verify borrowers’ income with the IRS.
The existing mortgage was originated on or before January 1, 2008;

Existing mortgage payment(s) as of March 1, 2008 exceeds 31 percent of the borrowers gross monthly income;

The homeowner did not intentionally default, does not have an ownership interest in other residential real estate and has not been convicted of fraud in the last 10 years under Federal and state law; and

The homeowner did not provide materially false information (e.g., lied about income) to obtain the mortgage that is being refinanced into the H4H mortgage.

Duration:

The program will begin October 1, 2008 and will finish  on September 30, 2011.

How does the Program Work?

There are four ways that a homeowner could pursue participation in the Hope for Homeowners program

1.  Homeowners should contact their existing lender and/or a new lender to discuss how to qualify and their eligibility for this program.

2. Servicers working with troubled homeowners may determine that the best solution for avoiding foreclosure is to refinance the homeowner into a new special H2H loan.

3. Originating lenders who are looking for ways to refinance potential customers out from under their high-cost loans and/or who are willing to work with servicers to assist distressed homeowners.

4.  Counselors who are working with troubled homeowners and their lenders to reach a mutually agreeable solution for avoiding foreclosure.
Besides working with their current lender this H4H program  includes the following provisions as well:

• The new loan amount may not exceed a maximum of $550,440.

• The new mortgage will be no more than 90 percent of the new appraised value including any financed Upfront MortgageInsurance Premium.

• The Upfront Mortgage Insurance Premium is 3 percent and the Annual Mortgage Insurance Premium is 1.5 percent.

• The holders of existing mortgage liens must waive all prepayment penalties and late payment fees.

• The existing first mortgage must accept the proceeds of the Hope for Homeowners loan as full settlement of all outstanding indebtedness.

• Existing subordinate lenders must release their outstanding mortgage liens.

What should you do next?

If you  are threatened by possible   foreclosure  you should find good professional  foreclosure help.  You may schedule online your FREE Foreclosure Consultation here . The experts will guide you through the whole process  including negotiation with current lender  and/or arranging other - Hope for Homeowners Program  solutions.

The final list of all participating lenders is not ready yet. As soon as it is officially announced we will publish it here. Stay tuned and subscribe to our newsletter or rss feeds.

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Finding foreclosure help is important in preventing foreclosure. If you find yourself in financial constraints and unable to pay your mortgage, there are programs and professional that are able to help. A valuable resource is the HUD web site. Hus (The US Department of Housing and Urban Development) is a great place to start looking for foreclosure help. They provide valuable tips for preventing foreclosure.
The first tip is to not ignore the problem. Pretending that the problem will go away or fix itself will cause more harm than good. There are help options that available when you first start missing payments that are not available after a certain number of payments are missed. Many times, your lender will send correspondence that will provide valuable information on foreclosure help. Never ignore any letter that your mortgage lender may send you. By contacting your lender early on, they may be more prone to give you assistance in finding a way to keep your house. Lenders don?t want foreclosure any more than you do. It is an expensive procedure for them and they are not in the business of selling houses. There are also laws that prevent them from making a profit on the resale of foreclosed home.
Another helpful tip offering foreclosure help is to re-examine your spending. After paying for food and healthcare, keeping your house needs to be your next priority. Consider all the non-essentials that you spend money on each month. See where you can cut expenses to make your mortgage payments. Things like cable TV, memberships, cell phones, and entertainment are examples of spending that can usually be trimmed back. Also look at what assets you have that you are able to sell. Jewelry, life-insurance policies and automobiles are good examples of assets that you can sell and use the money to pay down your mortgage.
One of the most important tips is to avoid foreclosure prevention companies that charge high fees for their foreclosure help. Many of these companies will charge high fees (often the equivalent of 2-3 times your monthly mortgage costs) and provide you with information that is free to access. While there are companies that can assist you in preventing foreclosure, make sure they are reputable and offering foreclosure help that you cannot find on your own. Also avoid companies that claim that they can stop your foreclosure for you and all you have to do is sign a few papers. You may end up a renter in your own house. There are scams where companies have you sign to transfer your deed to avoid foreclosure. Consult with legal counsel before signing anything. Make sure that you are only dealing with reputable companies. If it sounds to too good or easy, is probably isn?t legitimate.