Home Affordable Modification Program
If you are not unemployed, but you’re still struggling to make your mortgage payments, you may be eligible for the Home Affordable Modification Program (HAMP®). HAMP may lower your monthly mortgage payments in order to make them more affordable and sustainable for the long-term.
If you currently occupy your home as your primary residence, we encourage you to contact your mortgage servicer as soon as possible to begin the HAMP evaluation process.
In an effort to continue to provide meaningful solutions to the housing crisis, effective June 1, 2012, the Obama Administration expanded the population of homeowners that may be eligible for the Home Affordable Modification Program to include:
- Homeowners who are applying for a modification on a home that is not their primary residence, but the property is currently rented or the homeowner intends to rent it.
- Homeowners who previously did not qualify for HAMP because their debt-to-income ratio was 31% or lower.
- Homeowners who previously received a HAMP trial period plan, but defaulted in their trial payments.
- Homeowners who previously received a HAMP permanent modification, but defaulted in their payments, therefore losing good standing.
Principal Reduction Alternative (PRA)
If your home is currently worth significantly less than you owe on it, MHA's Principal Reduction Alternative (PRA) was designed to help you by encouraging mortgage servicers and investors to reduce the amount you owe on your home.
You may be eligible for PRA if:
- Your mortgage is not owned or guaranteed by Fannie Mae or Freddie Mac.
- You owe more than your home is worth.
- You occupy the house as your primary residence.
- You obtained your mortgage on or before January 1, 2009.
- Your mortgage payment is more than 31 percent of your gross (pre-tax) monthly income.
- You owe up to $729,750 on your 1st mortgage.
- You have a financial hardship and are either delinquent or in danger of falling behind.
- You have sufficient, documented income to support the modified payment.
- You must not have been convicted within the last 10 years of felony larceny, theft, fraud or forgery, money laundering or tax evasion, in connection with a mortgage or real estate transaction.
Second Lien Modification Program (2MP)
If your first mortgage was permanently modified under HAMPSM and you have a second mortgage on the same property, you may be eligible for a modification or principal reduction on your second mortgage as well, through MHA's Second Lien Modification Program (2MP). 2MP works in tandem with HAMP to provide comprehensive solutions for homeowners with second mortgages to increase long-term affordability and sustainability. If the servicer of your second mortgage is participating, they can evaluate you for a second lien modification.
You may be eligible for 2MP if you meet all of the following criteria:
- Your first mortgage was modified under HAMP.
- You must not have been convicted within the last 10 years of felony larceny, theft, fraud or forgery, money laundering or tax evasion, in connection with a mortgage or real estate transaction.
- You have not missed three consecutive monthly payments on your HAMP modification.
FHA Home Affordable Modification Program (FHA-HAMP)
FHA, VA and USDA all offer mortgage modification programs for struggling homeowners designed to lower monthly mortgage payment to no more than 31 percent of the homeowner's verified monthly gross (pre-tax) income — making monthly mortgage payments much more affordable. If you have a loan that is insured or guaranteed by the Federal Housing Administration (FHA), you may be eligible for a program offered through that government agency.
USDA's Special Loan Servicing
FHA, VA and USDA all offer programs for rural homeowners to lower their monthly mortgage payment to no more than 31 percent of their verified monthly gross (pre-tax) income — making monthly mortgage payments more affordable. If you have a loan that is guaranteed by the United States Department of Agriculture's (USDA) Section 502 Single Family Housing Guaranteed Loan Program, you may be eligible for a program through that government agency.
Veteran's Administration Home Affordable Modification (VA-HAMP)
FHA, VA and USDA all offer programs for struggling homeowners that strive to lower your monthly mortgage payment to 31 percent of your verified monthly gross (pre-tax) income — making monthly mortgage payments much more affordable. If you have a loan that is insured or guaranteed by the Department of Veterans Affairs (VA), you may be eligible for a program through that government agency.
Home Affordable Foreclosure Alternatives (HAFA) Program
If you can't afford your mortgage payment and it's time for you to transition to more affordable housing, the Home Affordable Foreclosure Alternatives (HAFA) program is designed for you. HAFA provides two options for transitioning out of your mortgage: a short sale or a Deed-in-Lieu (DIL) of foreclosure. In a short sale, the mortgage company lets you sell your house for an amount that falls "short" of the amount you still owe. In a DIL, the mortgage company lets you give the title back, transferring ownership back to them.
In either case, HAFA offers benefits that make the transition as favorable as possible:
- You can get free advice from HUD-approved housing counselors and licensed real estate professionals.
- Unlike conventional short sales, a HAFA short sale completely releases you from your mortgage debt after selling the property. This means you will no longer be responsible for the amount that falls "short" of the amount you still owe. The deficiency is guaranteed to be waived by the servicer.
- In a HAFA short sale, your mortgage company works with you to determine an acceptable sale price.
- HAFA has a less negative effect on your credit score than foreclosure or conventional short sales.
- When you close, HAFA provides $3,000 in relocation assistance.
Treasury/FHA Second Lien Program (FHA2LP)
If you have a second mortgage and your first mortgage servicer agrees to participate in FHA Short Refinance, you may be eligible to have your second mortgage on the same home reduced or eliminated through the FHA Second Lien Program (FHA2LP). If your second mortgage servicer agrees to participate, the total amount of your mortgage debt after the refinance cannot exceed 115 percent of your home's current value.
- You are eligible for FHA Short Refinance.
- You obtained your mortgage on or before January 1, 2009.
- You must not have been convicted within the last 10 years of felony larceny, theft, fraud, forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction.
f you're not behind on your mortgage payments but have been unable to get traditional refinancing because the value of your home has declined, you may be eligible to refinance through MHA's Home Affordable Refinance Program (HARP). HARP is designed to help you get a new, more affordable, more stable mortgage. HARP refinance loans require a loan application and underwriting process, and refinance fees will apply.
You may be eligible for HARP if you meet all of the following criteria:
- The mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae.
- The mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009.
- The mortgage cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009.
- The current loan-to-value (LTV) ratio must be greater than 80%.
- The borrower must be current on the mortgage at the time of the refinance, with a good payment history in the past 12 months.
FHA Refinance for Borrowers with Negative Equity (FHA Short Refinance)
If you're not behind on your mortgage payments but owe more than your home is worth, FHA Short Refinance may be an option that your mortgage servicer will consider. FHA Short Refinance is designed to help homeowners refinance into more affordable, more stable FHA-insured mortgage. If your current lender agrees to participate in this refinance, they will be required to reduce the amount you owe on your first mortgage to no more than 97.75 percent of your home's current value.
You may be eligible for FHA Short Refinance if you meet the following criteria:
- Your mortgage is not owned or guaranteed by Fannie Mae, Freddie Mac, FHA, VA or USDA.
- You owe more than your home is worth.
- You are current on your mortgage payments.
- You occupy the house as your primary residence.
- You are eligible for the new loan under standard FHA underwriting requirements.
- Your total debt does not exceed 55 percent of your monthly gross income.
- You must not have been convicted within the last 10 years of felony larceny, theft, fraud, forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction.
Home Affordable Unemployment Program (UP)
If you are unemployed and depending on your situation, MHA's Home Affordable Unemployment Program (UP) may reduce your mortgage payments to 31 percent of your income or suspend them altogether for 12 months or more.
You may be eligible for UP if you meet all of the following criteria:
- You are unemployed and eligible for unemployment benefits.
- You occupy the house as your primary residence.
- You have not previously received a HAMPSM modification.
- You obtained your mortgage on or before January 1, 2009.
- You owe up to $729,750 on your home.
Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets (HHF)
Early in 2010, Treasury announced that the Hardest Hit Fund® would provide more than $7.6 billion in aid for homeowners in states hit hardest by the economic crisis. Since then, state housing finance agencies have used the fund to develop programs that stabilize local housing markets and help families avoid foreclosure. Hardest Hit Fund programs complement the Making Home Affordable Program but are not limited to homeowners eligible for Making Home Affordable.
Hardest Hit Fund programs vary state to state, but may include:
- Mortgage payment assistance for unemployed or underemployed homeowners
- Principal reduction to help homeowners get into more affordable mortgages
- Funding to eliminate homeowners' second lien loans
- Help for homeowners who are transitioning out of their homes and into more affordable places of residence.
In total, $7.6 billion have been allocated to 18 states plus the District of Columbia.
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CONNECTICUT
CT FAMILIES
Description: This $50 million refinance program targets low- and moderate-income first-time homeowners with subprime mortgage loans. CT FAMILIES aims to help those homeowners who currently reside in their homes but are having or anticipate having difficulty making their mortgage payments by giving them the opportunity to refinance to 30-year, fixed-rate, fully-amortizing loans at 0.25 percent above CHFA's regular rate.
Investment: $50 million, from previously issued bonds
Targeted demographic: Low- and moderate-income, first-time homeowners
DELAWARE
Delaware Emergency Mortgage Assistance Program (DEMAP Program)
Description: The DEMAP Program provides Delaware homeowners with mortgage payments to prevent foreclosures that result from circumstances beyond the homeowner's control. Eligible homeowners may obtain a continuing loan to pay their delinquent balance and make ongoing payments or a non-continuing loan to pay their delinquent balance. Loans come with a fixed 3 percent simple interest rate and may not exceed $15,000.
Investment: $650,000 in state funding
Eligibility: Borrowers with incomes less than 155 percent of the state median income who are 60 days or more delinquent on their loans but have a good credit history prior to delinquency and can demonstrate that they are experiencing a financial hardship beyond their control.
ILLINOIS
Description: If passed, the Homeowner Assistance Pool would help homeowners with unaffordable mortgage loan payments refinance to 30-year, fixed-rate mortgages, backed by the Federal Housing Administration. The new loans would have interest rates between 5.75 percent and 8 percent with a $1000 cap on fees and no prepayment penalties. The maximum loan will be $417,000, covering up to 100% of the value of the home.
Investment: $200 million committed by four of Illinois' largest mortgage lenders: Guaranteed Rate, Chicago Bancorp, Professional Mortgage, Inc., and Perl Mortgage
Eligibility: The Homeowner Assistance Pool has no income requirements and is open to homeowners regardless of their current mortgage product. Borrowers must go through mortgage counseling and must have a minimum credit score of 580 (approximately 90 percent of the population has credit scores of at least 580). Families who do not meet the criteria may still be offered new loans, but the terms may vary.
MARYLAND
"Lifeline" Refinance Mortgage Program (Lifeline)
Description: Through Lifeline, Maryland homeowners who may be facing difficulties after financing their homes with adjustable rate or other unfavorable mortgages, or with mortgages that no longer fit their financial situation, may refinance to a new mortgage loan through one of the state's approved lenders. The program offers 30- and 40-year fully amortizing loans and interest only loans with 7/23, 5/30, and 7/33 schedules. Currently, all loan products carry a 6.5 percent interest rate. Loans may be up to 100 percent of the home's loan to value ratio or up to 103 percent if the loan includes upfront financing for a mortgage insurance premium. The maximum combined loan-to-value ratio is 110 percent, which can include financing for closing costs, prepayment penalties, and CDAs points. Borrowers with credit scores below 680 must attend credit counseling.
Investment: $100 million in private capital raised by DHCD
Eligibility: Borrowers must be below set income and appraised home value limits, which are based on household size and county. Borrowers in designated "target" areas have higher income and appraisal ceilings. Borrowers seeking a mortgage refinance through Lifeline must refinance all liens against the property, which must be the borrower's primary residence. Borrowers may not be eligible for a loan refinance if their credit scores are below 600.
MASSACHUSETTS
Home Saver Foreclosure Prevention Program (Home Saver)
Description: Home Saver is a counseling and loan program to help low- and moderate-income victims of predatory lending refinance their home mortgage loans. Borrowers must participate in housing counseling to be eligible for the program. Borrowers successfully completing counseling through a state-approved counseling agency may submit their application to a participating lender.
Investment: $250 million in private financing, including $190 million from Fannie Mae and $60 million from MassHousing
Eligibility: Borrowers must meet income and loan limit restrictions, demonstrate that they were victims of predatory lending, demonstrate ability to repay the refinanced loan, have a minimum credit score between 560 and 620, and be no more than 60 days delinquent on their mortgage payments.
MyCommunity Refinance Loans (MyCommunity)
Description: Borrowers who are not eligible to participate in the Home Saver program may be able to reduce their risk of high payments in the future on their current mortgages by taking advantage of a MyCommunity Refinance Loan. These loans give borrowers the opportunity to refinance to a 30-year or less, fixed-rate mortgage loan up to $417,000 for single-family homes and condominiums. MassHousing services the loans, which can include closing costs and a no-point option. Low-income borrowers can access to discounted mortgage insurance through the program. Borrowers can refinance 100 percent of the appraised value of single-family homes and condominiums, 97 percent of the appraised value of 2-family homes, and 95 percent of the appraised value of 3- to 4-family homes. Only state approved lenders may originate the loans.
Investment: MassHousing-approved lenders originate MyCommunity loans and then sell the loans service-released to MassHousing, which in turn sells the loans to Fannie Mae through the Fannie Mae cash window. The cash window is a market where Fannie Mae buys whole loans for cash. These whole loans are purchased either on a best efforts basis or under mandatory delivery commitments. Fannie Mae purchases the mortgage, but MassHousing retains the servicing of the mortgage.
Eligibility: Borrowers must be below 135 percent of the area median income and have good credit histories.
MICHIGAN*
*Note – Both programs are pending legislative approval.
Adjustable Rate Mortgage (ARM) Refinance Program (ARM Refinance Program)
Description: The ARM Refinance Program would assist homeowners, who have an ARM, in refinancing to a lower-interest fixed-rate loan.
Investment: Taxable bonds
Eligibility: To qualify for an ARM Refinance Loan, borrowers would be required to meet income and home value limits set MSHDA, and hold an ARM loan schedule to reset to a rate that is unaffordable to the borrower.
Rescue Refinance Program
Description: The Rescue Refinance Program would assist individuals who have a delinquency on their mortgage and who are at risk of losing their home.
Investment: Taxable bonds
Eligibility: To qualify for an ARM Refinance Loan, borrowers would be required to meet income and home value limits set by MSHDA, and hold an ARM loan schedule to reset to a rate that is unaffordable to the borrower. This fund would be reserved for those homeowners that have already missed loan payments due to an interest rate reset.
MONTANA
Montana Foreclosure Prevention Program (MFPP)
Description: The Montana Board of Housing (MBOH) provides support to the Montana HomeOwnership Center (MHC), a consortium of state and local government agencies and nonprofit housing organizations. MHC has made foreclosure intervention loans for more than 10 years. MHC has made 127 loans total, none of which have gone into foreclosure. Currently, MHC is providing zero-interest and/or deferred subordinate mortgages to help delinquent homeowners bring their mortgages current; the option to refinance a subprime loan; and amortizing, interest-bearing foreclosure prevention loans. Loan sizes depend on individual situations.
Investment: $400,000 "cypres" award from a local court, created with funds remaining from a class action lawsuit (zero-interest, deferred subordinate, and subprime loan refinance); funding from NeighborWorks America (subprime loan refinance)
Eligibility: Homeowners must be able to demonstrate that they will be able to resume making their mortgage payments once they have received assistance from one of MHC's programs. Homeowners who will likely foreclose even with financial assistance are not eligible.
NEW HAMPSHIRE
Emergency Assistance for Housing
Description: The New Hampshire Department of Health and Human Services (DHHS) provides Emergency Assistance to families experiencing a housing or utility crisis by providing eligible families payments for rent or utility security deposits, household fuel deliveries, or outstanding rent, mortgage and utility debts. The aim of the program is to help families avoid homelessness or avoid having a utility terminated that would result in the lack of heat, hot water, or cooking fuel. Emergency assistance payments cannot exceed $450 for heat, hot water, and cooking fuel; the amount charged by a utility for utility deposits; $650 for rental housing and security deposits; or no more than two months’ outstanding mortgage, rent, or utility debt.
Eligibility: To receive Emergency Assistance, families must be receiving federal Temporary Assistance for Needy Families (TANF) financial assistance or be eligible to receive TANF assistance.
NEW JERSEY
Home Ownership Preservation Refinance Program (HPRP)
Description: The HPRP provides an affordable financing alternative to borrowers whose current mortgage is no longer suitable for their financial situation as well as closing cost assistance and homeownership counseling. HPRP is a 30- or 40-year loan, refinanced through a state-approved lender, with a fixed rate of 8 percent for a 30-year loan and 8.125 percent for a 40-year loan. The loan can be equal to 100 percent of the appraised value of the home or 103 percent of the appraised value if private mortgage insurance is included in the mortgage loan.
Investment: $30 million, advance funded by HMFA; a taxable bond will be sold to replace the agency's funds.
Eligibility: To participate in the program, families may earn up to 140 percent of the area median income, must demonstrate a financial hardship, must occupy their homes as their primary residences, and must have been denied a loan modification. If the loan has already reset, a borrower may have up to three 30-day or one 60-day delinquency during the past 12 months. There is no minimum credit score requirement. Borrowers seeking to refinance before a rate reset must have no late payments during the past 12 months, must have a credit score of 575 or higher, may not own any other residential real estate property, and must show the ability to repay the loan.
NEW YORK
Keep the Dream Mortgage Refinancing Program
Description: The Keep the Dream program is designed to help New York households with certain high-risk mortgages avoid foreclosure by enabling families with adjustable rate, interest-only, or other unconventional mortgages refinance through a state-approved lender to a 30- or 40-year, fixed-rate mortgage with a competitive interest rate. Borrowers may refinance single-family homes, condominiums, co-ops, and 2-4 family homes. There are maximum loan amounts for each property type, ranging between $417,000 and $645,300, and maximum financing limits, which is 100 percent for single-family homes, condos, and co-ops, 97 percent for 2-family homes, and 95 percent for 3- and 4-family homes.
Eligibility: Borrowers must demonstrate a mortgage payment hardship or future hardship as a result of a mortgage loan. Borrowers who are less than 60 days delinquent on a loan because of an interest rate reset may also be eligible. Borrowers must have incomes at or below 165 percent or 125 percent of the area median income, depending on location. All borrowers must complete homebuyer education at a federal- or state-approved counseling organization and must agree to participate in early delinquency intervention counseling should they fall behind on their Keep the Dream loan.
Investment: $100 million from Fannie Mae
NORTH CAROLINA
Home Protection Program and Loan Fund
Description: The North Carolina Home Protection Program and Loan Fund, established in 2004, aims to help workers who have lost their jobs due to economic conditions by providing financial assistance to help them make their mortgage payments and avoid foreclosure. Eligible individuals may apply for a zero-interest loan equal to the lesser of $24,000, 24 months of monthly mortgage payments, or the minimum amount required to bring loans and other mortgage-related obligations current. Those who receive mortgage assistance may have repayment deferred for 15 years unless the home is sold, refinanced, or no longer owner-occupied, in which case the loan must be paid. Those who qualify for the program also receive a 120-day stay of foreclosure, which begins when the North Carolina Housing Finance Agency receives a completed application for assistance. Homeowners must apply through participating agencies, which determine in a advance whether homeowners are eligible.
Eligibility: To be eligible for a loan, borrowers must have lost their job due to changing economic conditions, have a mortgage that is secured by real property, demonstrate an ability to resume your mortgage payment after the assistance ends, and have had a stable employment and credit history prior to losing their job.
Investment: Funds are available on a first come, first serve basis until funds are expended.
PENNSYLVANIA
REfinance to an Affordable Loan Program (REAL)
Description: The REAL program combines 100 percent financing and flexible credit underwriting to offer troubled borrowers the opportunity to refinance their loans to 30-year, fixed rate mortgages. Refinances are originated by state-approved lenders, and refinance funds may be used to finance subordinate mortgages, closing costs, prepayment penalties, delinquent property taxes, and arrearages that have occurred within the past 12 months after the loan reset to a higher monthly payment amount.
Eligibility: Eligible borrowers must have annual household incomes less than $120,000, be no more than 59 days past due on the existing mortgage, and have a credit score of 620 or higher or have a mortgage with an interest rate that has reset during the past 12 months with 1) no more than two 30-day delinquencies and 2) no more than three 30-day delinquencies on other debts during the past 12 months. Borrowers must have monthly debt that is less than 50 percent of their gross incomes.
Homeowners' Equity Recovery Opportunity Loan Program (HERO)
Description: The HERO program targets borrowers who are unable to afford their current mortgage payments. The HERO program provides for up to 100 percent financing but instead of refinancing current mortgages into a new loan, PHFA purchases loans directly from a current lender and then sets up borrowers with an affordable repayment agreement. PFHA services the loans, which are 30-year, fixed rate loans that may finance up to 100 percent of a home's appraised value. The loans may include property taxes and mortgage insurance. The loan may be used to pay off the current mortgage debt, closing costs and prepayment penalties, and delinquent property taxes. The refinanced property must be the borrower's primary residence.
Investment: $5 million loan-loss reserve in southeastern Pennsylvania from PNC Bank, $1 million for loans made in Philadelphia from the City of Philadelphia; PNC funds will be used to leverage a planned bond issue of $25 million to provide the financing for the loans
Eligibility: This program is for borrowers not eligible for PHFA's REAL program or another mortgage refinance product available in the general market due to credit issues or owing more than the home's current appraised value. All approved borrowers must attend in-person financial counseling at a PHFA-approved agency. Borrowers must have a gross annual income less than $120,000, demonstrate an effort to meet financial obligations, and have sufficient income to repay the HERO loan.
FLEX MOD OPTIONS
The Flex Mod Options (not program names that a servicer would necessarily recognize) are designed to utilize HAMP's basic back-end rate, term and NPV calculations while allowing for more flexible eligibility criteria, tolerances and variances.
- There is no restriction on when the loan was originated
- The property securing the loan doesn't have to be the borrower(s)’ primary residence or be currently occupied
- The Unpaid Principal Balance (UPB) of the loan can be more than the usual limit set for the Property Type
(e.g. $729,750 limit for a Single Family Residence)
- The current monthly payment CAN be lower than 31% of the borrower(s)’ gross income
- The new loan terms do not need to result in at least a 6% reduction in the borrower(s)’ monthly payment
- The resulting LTV ratio of the new interest bearing balance compared to the new Estimated Market
Value of the subject property can be as low as 80%
- Since the Flex Mod Options may not be HAMP eligible, the model excludes any Servicer Incentives