Marc in Fort Lauderdale, Florida asks:

I have a negative amortization loan (Option ARM) that is about to recast. I can barely afford the minimum payment now, much less a fully amortized payment when it recasts in August. Can I apply for a modification?

Answer

This is precisely one of the main targets that the Treasury is addressing. (Toxic loans). Affordability based on one’s income is the main barometer to qualify for HAMP. Assuming you qualify, having a toxic loan is in fact a hardship under HAMP.

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