Obama’s Loan Modification Plan

Obama’s Loan Modification Plan is intended to aid homeowners with home loan modification or refinancing for more manageable mortgage payments.

The sad fact is a great part of the money go to the banks and they’re not mandated to heed. Only homeowners who aren’t behind on their mortgage account and whose loans are with Fannie Mae and Freddie Mac are eligible for the Plan. The plan is leaving millions of U.S. homeowners in danger of facing foreclosure defenseless & out of the plan.

Here are a few general routine precepts for basic eligibility for this program:

1. The home must be owner occupied

2. Not applicable to 2nd mortgages

3. You must show proof of income

4. Your current mortgage must be 31% or more of your gross monthly income

As many as 6 million families are projected to face foreclosure in the next couple of years.

The scathing and fast paced recession in the economy and in the housing market has caused overwhelming repercussions for homeowners throughout the America . Millions of reliable families who meet their monthly mortgage payments timely have had the value of their property fall and consequently are now ineligible to refinance to lower mortgage rates. Meanwhile, millions of workers in the United States are facing challenges trying to stay current on their mortgage payments after being laid off or downsized. In the last 14 months alone well over five million jobs have been cut and millions of hard working families are now applying more than 40 or 50 percent of their income towards their monthly mortgage payment.

The Process
When a loan modification application is presented by a homeowner, it is scrupulously evaluated to judge the profitability to the investor or the probability of loss. The “Net Present Value Test” is used to decide what will bring more cash flow to the investor-Foreclosure or Modification. Their decision is not based on what’s best for the homeowner. It is entirely based on what is more financially rewarding to the investor. If modification is not in the favor of the investor, they will not approve your application.

For this reason legal assistance is available to homeowners.

Learn more about Home Loan Modification. Stop by Janian and Associates’s site where you can find out all about how to prevent foreclosure.