Houston Area Mortgage Loan Modification

What is a loan modification?

A mortgage modification is when the mortgage company, at their discretion, restructures a mortgage to help make the payment fit within a homeowner’s budget. A mortgage modification may lower the interest rate of the loan, extend the term of the loan and/or reduce the principal owed. This process involves sending documents to the mortgage company (such as pay stubs, bank statements, and tax returns) and filling out their application.

What is the Making Home Affordable Program (MHA)?

The Making Home Affordable Program (MHA) is a program the Federal government has enacted to help homeowners who are having difficulty paying their mortgage. Lender’s participation in the program is voluntary, and they may deny or refuse applicants for any reason. The program is intended to help homeowners who are struggling to make their monthly mortgage payment or who are already behind on their monthly mortgage payments. Through the MHA there are many modification options offered to homeowners.

What is a HAMP loan modification?

The MHA’s most well-known program is the Home Affordable Modification Program (HAMP). This program is designed to encourage lenders to restructure loans in certain situations to make mortgage payments more affordable to the borrower. You may qualify to apply for a HAMP modification if:
• You are a homeowner struggling to make your mortgage payments due to a financial hardship.
• You are behind on your monthly mortgage payments or in danger of falling behind on your monthly mortgage payment.
• Your mortgage is dated on or before January 1, 2009.
• The mortgage balance is less than $729,750 for a single family home or a one-to-four unit rental property.
This list is not exhaustive. More information about the HAMP program can be found on the Making Home Affordable website: 
More Information About HAMP

Are there loan modification options other than HAMP available from the government?

If you have a loan guaranteed or owned by the FHA, VA or USDA you may qualify for that entity’s special mortgage servicing programs.

Is there an MHA program designed to if I am current but have been unable to refinance?

Yes, there is a program called the Home Affordable Refinance Program (HARP). The program is intended to help homeowners who have a loan owned by Fannie Mae or Freddie Mac.
More Information About the HARP program

Is there an MHA program to help if I am unemployed?

Yes. The Home Affordable Unemployment Program (UP) may be able to reduce your mortgage payments to 31% of your current income or may be able to suspend your mortgage payments for 12 months or more. The UP may be able to help you if:
• You are currently unemployed and not eligible for unemployment benefits.
• Your mortgage is dated on or before January 1, 2009.
• The mortgage balance is less than $729,750 for a single family home or one-to-four unit rental property.
This list is not exhaustive. More information about the PRA program can be found on the Department of Housing and Urban Development website:
 More Information About The UP Program

Can the MHA help if I owe more than my home is worth (my home is ‘under water’)?

Yes. The Federal Housing Administration Refinance for Borrowers with Negative Equity (FHA Short Refinance) program encourages mortgage lenders to reduce the principal balance when a home is under water. You may qualify for an FHA Short Refinance modification if:
• You are current on your mortgage payments.
• You owe more than your home is worth.
This list is not exhaustive. More information about the FHA Short Refinance program can be found on the Making Home Affordable website:
 More Information About The FHA Short Refinance Program

What if I just cannot afford my mortgage anymore? Can the MHA program help?

The Home Affordable Foreclosure Alternatives (HAFA) program is designed to help transition homeowners out of their home through a deed-in-lieu of foreclosure or a short sale. When a HAFA program transaction closes, you may be eligible to receive up to $10,000 in relocation assistance. You may qualify for HAFA assistance if:
• You are struggling to make your mortgage payments due to a financial hardship.
• You are behind on your mortgage or in danger of falling behind.
• Your mortgage is dated on or before January 1, 2009.
• The primary mortgage balance is less than $729,750 for a single family home or a one-to-four unit rental property.
This list is not exhaustive. More information about the HAFA program can be found on the Making Home Affordable website: 
More Information About The HAFA Program

Are there loan modification options other than HAMP available from my bank?

There are also ‘In-House Modifications,’ which are non-HAMP modifications usually explored by a bank after a HAMP modification is denied. Because applicants for in-house modifications are not required to meet HAMP standards, home owners who fail to qualify for a HAMP modification may be approved for a bank’s in-house modification program. You won’t know what options you have until you ask.

Am I required to have a lawyer to apply for a mortgage modification?

No. The mortgage modification process, however, can be very time consuming. Consumers frequently find they are being asked to send the same information multiple times. It is important to keep copies of all documents, send documents by certified mail, and stay in frequent contact with the mortgage company. The help of a good lawyer will help you avoid wasting time and being frustrated. They will help guide you through the process, keep track of your documents and follow up with the appropriate contact person at the mortgage company.