Obama Mortgage Rescue Plan 2011: 2 Percent Mortgage Rates Through Obama’s Mortgage Stimulus Plan

You may be able to take advantage of a government home rescue program that will give you a mortgage rate modification of 2%. Obama has implemented a very aggressive loan workout plan that is designed to help homeowners facing a financial hardship and at risk of defaulting on their home loan. There are millions of American’s who may be able to get the relief they need using this bailout program.

Homeowners facing financial hardships can get refinancing or home loan modification into a new, low interest, lower payment, mortgage. This is possible because of new refinancing an mortgage modification options which are available through Obamas housing stimulus plan. These hardships can include things such as a loss of job, reduced income, hospital bills, and a lot of things which are out of the homeowners control. Typically, a homeowner would have a hard time getting approval for refinancing or modification of their home loan, but this plan helps. A homeowner should write a brief letter stating their financial hardships, what they plan to do about them, and why refinancing is so important, and include it with your application.

Obama’s rescue plan is called Home Affordable Modification. It is funded by $75 billion in stimulus money-this is paid for with your tax dollars, so do not hesitate to find out if you qualify and use this program to help you stay in your home. Here are the basics of the plan and what it takes to qualify and apply.

Home Affordable Modification revolves around achieving a low monthly payment that equals 31% of the households gross monthly income. There are standard methods that can be used in order to reach that target payment. A mortgage rate modification down to 2% is the first step, then if more is needed, the loan term may be extended to 40 years. Finally, if necessary the principal balance may be reduced by deferring some or forgiving some of the principal.

All participating lenders have agreed to follow the same formula to determine who qualifies for a mortgage rate modification and then use the same methods to reach the target payment. This is good news for homeowners because you can also learn this very same formula and then prepare your application ahead of time so that it meets the guidelines. There are no guarantees of approval, but you can greatly increase your chance of success by simply learning the basics and then making any necessary adjustments before you submit your application to you lender.

Learn more about Obama Mortgage Relief Plan Qualifications.