Note to distressed homeowners: HAMP is a viable alternative to avoid short sales or foreclosure if your loan is not backed by Fannie Mae or Freddie Mac.
If you are having a tough time making your mortgage payments because you are unemployed, you may be eligible for UP.
The Home Affordable Unemployment Program (UP) provides servicers with the flexibility to provide assistance to borrowers whose hardship is related to unemployment and is a supplemental program to the Home Affordable Modification Program (HAMP). Specifically, UP requires servicers to grant qualified unemployed borrowers a forbearance period during which a borrower's monthly mortgage payment may be reduced or suspended prior to considering such borrowers for HAMP.
3/ Home Affordable Foreclosure Alternatives (HAFA)
If your mortgage payment is unaffordable and you are interested in transitioning to more affordable housing, you may be eligible for a short sale or deed-in-lieu of foreclosure through HAFA.
4/Home Affordable Modification Program SM (HAMPSM)
The Home Affordable Foreclosure Alternatives (HAFA) Program provides additional options to avoid costly foreclosures and offers incentives to borrowers, servicers and investors who utilize a short sale or deed-in-lieu (DIL) to avoid foreclosures. HAFA alternatives are available to all HAMP-eligible borrowers who: 1) do not qualify for a Trial Period Plan; 2) do not successfully complete a Trial Period Plan; 3) miss at least two consecutive payment during a HAMP modification; or, 4) request a short sale or DIL.
In a short sale, the servicer allows you to list and sell the mortgaged property with the understanding that the net proceeds from the sale may be less than the total amount due on the first mortgage. Generally, if the borrower makes a good faith effort to sell the property but is not successful, a servicer may consider a DIL.
With a DIL, the borrower voluntarily transfers ownership of the property to the servicer - provided the title is free and clear of mortgages, liens and encumbrances. With either the HAFA short sale or DIL, the servicer may not require a cash contribution or promissory note from the borrower and must forfeit the ability to pursue a deficiency judgment against the borrower.
HAFA simplifies and streamlines the short sale and DIL process by providing a standard process flow, minimum performance timeframes and standard documentation.
HAFA is available for mortgages that are owned or guaranteed by Fannie Mae and Freddie Mac or serviced by over 100 HAMP participating servicers.
Over one hundred mortgage companies have agreed to participate in the Home Affordable Modification Program (HAMP).
To help distressed homeowners lower their monthly mortgage payments, the U.S. Departments of the Treasury and of Housing and Urban Development established the Home Affordable Modification Program SM (HAMPSM) for mortgage loans that are not owned or guaranteed by Fannie Mae or Freddie Mac.
II - California Housing Finance Agency
1/ Unemployment Mortgage Assistance (UMA)
below is a brief summaries of the programs CalHFA implemented under the Keep Your Home Program. These programs were approved by the U.S. Treasury on June 23rd 2010, and are final.
You can find here
a list of participating servicers and programs that are currently available to distressed home owners.
This program intends to assist homeowners who have experienced involuntary job loss.
2/ Mortgage Reinstatement Assistance Program (MRAP)
UMA will provide temporary financial assistance in the form of a mortgage payment subsidy of varying size and term to unemployed home owners who wish to remain in their homes but are in imminent danger of foreclosure due to short-term financial problems.
The Unemployment Mortgage Assistance Program provided mortgage payment assistance to eligible homeowners who experienced an involuntary job loss and were receiving California EDD unemployment benefits. Benefit assistance through UMA lasted up to eighteen (18) months. The maximum assistance per household was $54,000.
This program intends to assist homeowners who have fallen behind on their mortgage payments due to a temporary change in a household circumstance.
3/ Principal Reduction Program (PRP)
MRAP will provide limited financial assistance in the form of funds to reinstate mortgage loans that are in arrears in order to prevent potential foreclosures. These funds can provide benefits of up to 25,000 per household to help qualified homeowners catch up on
their mortgage payments. Benefit assistance can cover principal, interest, taxes,
insurance, and any homeowner's association dues that are impounded in the first mortgage payment.
This program intends to assist homeowners at risk of default because of an economic hardship coupled with a severe decline in the home’s value.
III - FHA and VA Pre-Foreclosure Sale Programs
PRP will provide capital to reduce outstanding principal balances of qualifying borrowers with negative equity. Principal balances will be reduced in an effort to prevent avoidable foreclosures and promote sustainable home ownership up to $100,000.
The principal reduction program will most likely be a prelude to loan modification. Servicers that contribute through matching funds increase the benefit for homeowners.
A number of housing programs are available through the Federal Housing Administration (FHA) to avoid the short sale of the foreclosure of your home.
The Pre-Foreclosure Sale (PFS) Programs allow the mortgagor in default to sell his/her home and use the net sale proceeds to satisfy the mortgage debt even though these proceeds are less than the amount owed.
If you own a home with a mortgage insured by the Federal Housing Administration (FHA) and you are finding it difficult to make your mortgage payments or you are in default on your mortgage payments, you may be able to take advantage of the FHA Pre-Foreclosure Sale (PFS).
It allows you to sell your home at its current value and avoid foreclosure, even if the sales proceeds will not be enough to pay off your mortgage debt in full. This allows you to transition to more affordable housing while avoiding a foreclosure. (Ref: Mortgagee Letters 2003-19 and 2008-43).
To participate in the program, homeowners must be willing to make a commitment to actively market their home for a period of 3 months, during which time their mortgage lender delays foreclosure action.
Homeowners who successfully sell their property at near the present fair market value within the required time may be eligible to receive a cash payment from FHA of up to $1,000 to help them transition to more affordable housing arrangements.
If the property does not sell, the homeowner can choose to deed the property to the mortgage lender (deed-in-lieu of foreclosure).