As a loan modification lawyer, many people ask me about HUD loan modification programs, well the reality is, there really aren’t any HUD loan modification programs per se, but HUD is somewhat involved in loan modification. Some background: the U.S. Department of Housing and Urban Development (HUD) is the lead government agency on all federal housing programs. In the past, HUD has attempted to develop affordable housing for low income families. Today, HUD is mostly associated with the housing crisis the government Making Home Affordable (MHA) Plan.
HUD Loan Modification Programs
As the governmental agency that oversees the government plan to keep homeowners in their homes and stabilize the housing market through fewer foreclosures, HUD has gotten much attention recently after decades of obscurity. There really is no difference between a HAMP loan modification and a HUD loan modification, it is semantics referring to the same government programs and options to help homeowners avoid foreclosure. One point of confusion for many, HUD does not actually finance or refinance loan modifications for borrowers, the agency merely pushes lenders to do modify terms of existing loans.
HUD Loan Modification Requirements
To be considered for a HUD loan modification under HAMP, the following requirements must be met:
1. The home must be the primary residence of the homeowner. Vacation homes and rental properties are not eligible for government modification assistance;
2. The amount owed on the first mortgage must be equal to or less than $729,750;
3. The homeowner must have experienced a financial hardship;
4. The mortgage to be modified must have been originated before 1 January 2009
5. The payment of the mortgage (which includes interest, principal, insurance, association dues, and taxes) must be more than 31% of the homeowner’s current gross income.
Borrowers should keep in mind that just because they meet all of the above listed requirements, there is no guarantee that the modification will be approved. These are only general requirements issued by HUD to help homeowners determine whether or not a government loan modification would be right for them.
Which Lenders are Required to Offer HUD Loan Modification Programs
Only lenders who secure their loans through federally controlled Fannie Mae or Freddie Mac are required to offer HUD loan modification options. Other lenders may choose to participate in the program, but they are under no requirement to do so. To determine whether or not a specific lender takes part in HAMP.
California Loan Modification Lawyers
McFarlin LLP lawyers handle all aspects of loan modification for borrowers in Riverside, Orange County, Los Angeles, Sacramento, Fresno, Corona, Rancho Cucamonga and throughout California. Our attorneys are available to provide you with honest reliable advice at our Irvine office or over the phone. With a matter as important as loan modification and foreclosure, it is a very good idea to consider hiring a qualified California loan modification lawyer to represent you and protect your interests. Call us today at (888) 728-0044.