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2010-07-30 14:17:05
HAMP (Home Affordability Modification Program)

I get a lot of questions these days about HAMP, HARP, and all the new government programs.  I put together to this article help explain how HAMP works. The information is readily available on various government websites.


Home Affordability Modification Program (HAMP)

The Home Affordability Modification Program, or HAMP,  makes it possible for eligible homeowners  to modify their current mortgage in order to reduce the monthly payments. This is accomplished by adjusting the interest rate, reducing the principal amount of the loan, extending the period of the loan,  or a combination of both.

To qualify for HAMP the homeowner must:

• Be the owner-occupant of a one- to four-unit home.

• Have an unpaid principal balance that is equal to or less than:

     ο 1 Unit: $729,750

     ο 2 Units: $934,200

     ο 3 Units: $1,129,250

     ο 4 Units: $1,403,400

• Have a first lien mortgage that was originated on or before January 1, 2009.

• Have a monthly mortgage payment (including taxes, insurance, and home owners association dues) greater than 31% of your monthly gross (pre-tax) income.

• Have a mortgage payment that is not affordable due to a financial hardship that can be documented.

Homeowners experiencing financial difficulties and/or at risk of foreclosure that have loans owned or guaranteed by Fannie Mae or Freddie Mac are allowed to participate in HAMP.  In addition to Fannie Mae and Freddie Mac, there are many other lenders receiving government incentives to participate in the program as well.

As of June 2010 over 1.2 million homeowners have started trials of HAMP.  Of those, only 396,021 have become permanent modifications.  50,000 trials will be converted to permanent modifications in June – a 15% increase from May.  On average HAMP has reduced homeowners monthly payments by  about $510. 

HAMP expires on December 31, 2012. Your trial modification must be in place by that date.


If you are struggling to make mortgage payments and HAMP sounds like an option for you, or if you have any questions please feel free to contact us.  We will personally evaluate your situation and find a solution.

For more information about HAMP, including FAQ's click here.  





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HAMP (Home Affordability Modification Program)

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