President Obama announced the new ‘Making Home Affordable Program’ on February 18th of this year which allows homeowners the prospect of a loan mortgage modification. For homeowners who have been stressed out over possible defaulted and foreclosed loans it couldn’t have come soon enough. The prospect of a Modified Mortgage Loan was looking more and more to be like a much needed lifeline. However, even after the much- anticipated introduction of this bailout relief process it took weeks for the lending institutions to prepare their systems for it. This only added to the frustration that troubled homeowners have been experiencing for what has seemed like an eternity.

Over the past few months the Obama administration has enlisted a trio of the nations largest lending institutions to service the new mortgage modification program. JP Morgan, CitiGroup, and Wells Fargo have all jumped on the relief bandwagon. Why wouldn’t they? All financial institutions that join the program receive a barrel of incentives. Those who participate receive a thousand dollars per modification. Of course the homeowners get incentives as well. Each homeowner that keeps their account current will receive a thousand dollars a year over a three- year period.

This Mortgage Loan Modification program is expected to keep over 9 million Americans from losing their homes. Lets breakdown how this program works. Basically it is a 2 -part plan. Lending institutions take the first step by lowering monthly mortgages to no more than 31% of the homeowner’s gross income. The other option in the plan would be for the lender to redo the homeowner’s mortgage regardless of the equity. The Obama administration has put up 75 billion dollars to assist with the payment reduction. In addition, the lender must also lower interest rates to no more than 38% of the homeowner’ gross income. All moves to avoid rates hikes that come with adjusted rate mortgages.

Homeowner’s have been concerned about the possibility of their payments getting higher under the new modification. The only way that their payment would increase is if they are currently paying a low introductory rate. If a homeowner is pondering what their payment might be they can visit the payment reduction estimator at http://www.makinghomeaffordable.gov/evaluator.html. Just in case a homeowner is wondering, it would not be wise to procrastinate in the hopes that the mortgage rate will lower. Although the rate is the lowest it has been in many years it has began to inch upwards once again. If you are eligible for this Loan Mortgage Modification program you should take action now.

There is a list of eligibility requirements that must be met for this program. A homeowner in need can visit http://www.makinghomeaffordable.gov/eligibility.html to check eligibility. For some, applying for a Mortgage Loan Modification is a scary proposition. Only the homeowner knows their situation. The alternative may be more frightening. If your a homeowner under distress, examine your options and proceed with caution. Keep up to date with the latest information and advice on home mortgage loan modifications on the larger news stations which are running daily stories on modifying mortgages which may offer some help.

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