Federal Loan Modification - Helping Homeowners Help Themselves

Are you behind on your home mortgage? The present economy has caused many homeowners to fall into default due to circumstances over which they had no control Millions of homeowners will get help from the government in the form of a Federal Loan Modification.
You may not even know what that is, but you have probably heard of President Obama's Stimulus Plan. This is a program within that legislation that allocates 75 billion dollars to helping homeowners who are facing the threat of foreclosure. The goal is to completely rewrite their mortgages so that the resulting house payment is in a range that is affordable for them, thus allowing them to stay in their homes.
Is your loan one of the loans that could be modified? It needs to be written on a primary dwelling with an approved lender, backed by Fannie Mae or Freddie Mac, dated on or before January 1, 2009, and not be for more than $729,750. Your house payment, combined with property taxes, homeowners insurance, and homeowners association dues must be more than 31% of your gross monthly income.
While your lender will make the ultimate decision about your qualification, the two major income criteria involve proving you are struggling with the current payment due to financial hardship and proving you can pay the new payment. Every income and expense figure you state in your application must be documented with the appropriate paperwork.
Most experts will advise you that you should do all your preliminary preparation before you contact your lender. This will give you the best opportunity of presenting your situation in the best possible light. You only are allowed one opportunity to apply for a Federal Loan Modification, so you need to be sure you have everything lined up in accordance with the guidelines to the program.

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