Fha Loan Modification Requirements

fha loan modification requirements

Fha Loan Modification For Those Struggling With Debt

There have always been times where homeowners lose their jobs or have a change in circumstance that puts a restriction on their ability to afford their home and not able to pay their mortgage.

The options of refinancing with lower rates or selling the home were available to homeowners years ago. These options are not longer available to homeowners now.

Hector Milla Editor of the “Best Mortgage Loan Modification” website — http://www.BestMortgageLoanModification.net — pointed out;

“…Refinancing is not possible today due to the falling property values that have resulted in upside down mortgages. Even if the homeowner finds someone to buy their home they face the challenge of not selling it for enough money to pay the balance owed on it…”

The Mortgage Bankers Association states that 11% of the nation’s mortgages were delinquent by one payment and already in foreclosure. And 7% of mortgages were 1% month past due and 3% were currently in foreclosure. A large plan is offered today by the Federal Housing Administration known as the ‘mortgage modification. This allows lenders to refinance a mortgage into an FHA-insured fixed rate mortgage which gives homeowners the chance to stay in their homes, make the mortgage payments and defer money owed until a later date.

Just like Obama’s’ program this is trying to help reduce mortgage payments to 31% of monthly income by changing the principle and not the interest rate. The borrower of the loan will make the lower payments for the entire loan period, but is to pay off the entire loan if the home is refinanced or sold. Borrowers are now able to receive a loan modification after missing just one payment, rather than having to wait until they are three months, as it was required in the past.

“…To be approved for this loan, each home owner has to meet certain qualifications. The most important guideline to meet is debt ratio. Many lenders want this be between 34% and 45% for one to be accepted…” H. Milla added.

Qualifications to meet for approval of loan modification:
1. Current residence must be the mortgaged home.
2. A mortgage that began on or before January 1. 2009.
3. A mortgage that is lower than $729,500.
4. A hardship letter must be send to lender.
5. Proof of income has to be submitted.
6. Entire debt in the household is more than 55% or income.
7. Counseling must be completed.

Further information about how to get professional assistance with a mortgage loan modification by visiting; http://www.BestMortgageLoanModification.net

About the Author

Hector Milla runs his corporate website at http://www.OpsRegs.com where you can see all his articles and press releases.