Avoid foreclosure with home mortgage modification programs in Washington, D.C.
If you are struggling to make your mortgage repayments, home mortgage modification programs in Washington, D.C., make it possible to refinance for more affordable terms, even when a traditional refinance is not an option. You have many options for mortgage modification in Washington, D.C., through the federal Making Home Affordable Program (MHA).
Home Affordable Modification Program (HAMP)
The Home Affordable Modification Program ( HAMP ) is designed for homeowners who have income, yet cannot make their mortgage payments each month. In order to qualify for this program, you must meet the following criteria:
- You owe $729,750 or less on your home
- You are facing financial hardship
- Your mortgage was obtained on or before January 1, 2009
- You can afford to make reduced mortgage payments
- Your property has not been condemned
You do not have to be behind on your mortgage to qualify, but must be in danger of falling behind. If you are approved for HAMP, your loan can be modified so that the monthly payment is no greater than 31 percent of your gross income each month. This would be a permanent change to the terms of your home loan, and may involve changing the type of loan, extending the term or lowering the interest rate.
Principal Reduction Alternative (PRA)
HAMP does not reduce the principal amount of your loan. In some cases, the addition mortgage broker's fees may even increase the principal. The Principal Reduction Alternative (PRA) is a program for homes that have values lower than a homeowner’s mortgage. PRA encourages lenders to reduce the principal amounts on these loans. To qualify, you must meet the following criteria:
- You have a loan that was obtained on or before January 1, 2009
- You are "upside down" on your loan
- You owe $729,750 or less
- You have significant financial hardship
- You can afford the new payments
- You live in your house as your primary residence
If you meet these criteria, contact your lender and an MHA housing counselor to discuss PRA.
Second Lien Modification Program ( 2MP )
Most home mortgage modification programs in Washington, D.C., are for primary mortgages, not second mortgages. The Second Lien Modification Program, however, is for homeowners with second mortgages. If your primary mortgage was refinanced under HAMP, you may also be eligible for a second mortgage modification. To receive this help, both of your lenders must be participating in MHA.
These are just the highlights of MHA. There are several other programs for Washington, D.C. home loan modifications. If you are interested in MHA help, contact an authorized MHA housing counselor to find out which program suits your circumstances.
You may also want the help of a traditional mortgage lender. RealtyNow is a great resource for mortgage lenders in Washington, D.C., that specialize in refinancing.