Launched on March 4th, 2009, by the Obama administration, The Home Affordable Modification Program creates a defined loan modification process through which borrowers who are in default, at risk of imminent default, or in foreclosure can have their loans modified to a more affordable monthly payment equal to a target 31 percent of their monthly gross income.
All servicers must participate in the program for all eligible Fannie Mae portfolio mortgages and MBS pool mortgages. Servicers may also elect to participate in the HAMP for other qualifying mortgage loans that:
Are not subject to a Fannie Mae's credit loss guarantee; and
Are held by servicers in their own portfolios or are serviced by servicers for other portfolio or securitization trust or investors.
In order for a servicer to participate in the HAMP with respect to other qualifying mortgages, the servicer must execute a servicer participation agreement and related documents with Fannie Mae as Financial Agent for the United States (as designated by the Treasury).
The Home Affordable Modification Program will close to new borrowers on December 31, 2012.
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Mortgage modification programs are the answer to today's economic turmoil. Many homeowners wound up getting a loan that was difficult to afford during the good times, and now, have trouble making their payments. If you are experiencing severe financial hardship, look to a loan modification program instead of bankruptcy or defaulting on your home and find out if you can keep your home.
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