Understanding the Home Affordable Modification Program– What you Need to Know

The Home Affordable Modification Program (HAMP) was created by the United States Department of the Treasury and the Obama Administration. This loan modification program is designed to help an estimated 5 million U.S. households save their home from foreclosure.

As part of the broader effort to stabilize the nation’s economy and real estate market, HAMP has already helped homeowners like you stay in their homes with a low fixed rate, better terms, and lower monthly payments.

What are the HAMP loan modification requirements?

Applying for HAMP can feel a lot like applying for a new mortgage. There are certain preconditions that must be met in order to qualify for a HAMP loan modification.

The following requirements must be taken into account prior to applying for a HAMP loan modification. You must:

  • Have suffered a financial hardship that you can document.
  • Have a mortgage payment that is no longer affordable due that hardship.
  • Intend to keep your home as an owner-occupied residence.
  • Own and be currently residing in a single family home or home with up to four units.
  • Have an unpaid principal balance that is equal to or less than:
    • 1 Unit: $729,750
    • 2 Units: $934,200
    • 3 Units: $1,129,250
    • 4 Units: $1,403,400
  • Have a primary first lien mortgage that was closed on or before January 1, 2009.
  • Have a total monthly housing payment (including taxes, insurance, and any home owners association dues) greater than 31% of your monthly gross (pre-tax) income.

If you can answer “Yes” to all of these points, you may be eligible for a HAMP loan modification.

What information and forms does the HAMP loan modification program require?

The following two forms are required to be filled out and completed during the HAMP qualification process:

  • MHA Request for Modification and Affidavit Form (RMA). Basically, this form will tell the lender what your income, expenses, and assets are. Any secondary (subordinate) liens on the property must also be noted. The MHA Request for Modification and Affidavit Form (RMA) also includes a Hardship Affidavit, fraud notice, and information about any Trial Period Plan your lender may put you through (see below for further HAMP trial period plan details).
  • The Internal Revenue Service (IRS) Form 4506T-EZ (Short Form Request for Individual Tax Return Transcript). The 4506-T form gives the servicer of your loan permission to requests from the IRS, a copy of your most recent filed tax returns. It’s highly advisable to print two copies of the completed form; one for you, the other for your lender.

What proof of income is required by the HAMP loan modification program?

You will be required to provide copies of paystubs that cover a 30day period. These statements must show year to date earnings. If you get paid seasonally, through commissions or are self-employed, you should be able to send your most recent quarterly or year-to-date profit and loss statement.

Under the HAMP program your lender might place you in a three-month trial period. During this time, you are proving that you can sustain the modified payment. You also get direct relief from the threat of foreclosure. By properly applying for HAMP, foreclosure proceedings must be stayed.

Florida Mortgage Loan Modification Services

The John W. Persse Law Group is located in Sarasota, Florida and offers mortgage loan modification services to clients throughout Florida.

Learn More About HAMP and Mortgage Loan Modifications:

For more info about the HAMP Program and how it can benefit you and your family,

Please contact us.

We want to help you save your home.

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