Federal Plan

You can learn the standard formula that participating lenders use to determine your eligibility under the Obama Home Affordable Modification Plan. The Treasury Department has mandated that this formula be used when reviewing a borrowers request for a loan modification. Learn this basic 4 step formula and then you will be able to pre-qualify yourself and have a much better chance of getting your proposal approved.

The Treasury Department home rescue plan has some very good benefits for borrowers.  The federal Home Affordable Modification Plan or HAMP, is designed to provide an affordable and sustainable mortgage payment for homeowners who are either delinquent or at imminent risk of becoming delinquent. The first criteria that must be met is an evidence of a financial hardship situation. This could be due to any number of circumstances, but the generally acceptable ones include:

1. Loss in income or loss of income
2. Change in your financial situation
3. Using up your savings and having insufficient cash reserves to pay mortgage and basic living expenses-excluding retirement accounts
4. An Increase in Expenses
5. Excessive monthly debt payments and over extension with creditors-living off credit cards
6. Other reasons for hardship-each situation is unique

The standard formula used by lenders under the Obama HAMP is:

1. Verify the existing payment equals more than 31-38% if the household gross monthly income
2. New target payment that equals 31% of the gross monthly income (can use all household income-including roommates)
3. Arrive at new loan terms to reach that target payment by first reducing interest rate to as low as 2%, extending loan term to 40 years, and deferring or forgiving part of the the principal balance.
4. Verify that the homeowners financial statement information fits the debt ratio and target payment calculation by reviewing their financials

There are 7 basic triggers for acceptance into the HAMP guidelines.  You can use a software program that actually mimics these 7 triggers-included in The Complete Loan Modification Guide is the Loan Mod QUick App software.  Designed just for homeowners, it takes all the guess work out of preparing your financial statement.  Simply input your own specific income and expenses, and you see immediately what your debt ratio, new target payment, new interest rate and disposable income are.  It couldn’t be easier-you know immediately if you need to make any adjustments to your budget before your lender turns you down.

So, the way that you can be sure you have a very good chance of approval is to learn the basics of how to figure your target payment and debt ratio, then fine tune your financial statement and make any necessary adjustments to your budget before you send your proposal into your lender. Take the time to learn and prepare, and you will have a very good chance of getting the help you need and deserve. You can use the very same formula your bank will use when you prepare your own financial statement. It makes sense to fine tune your application so you meet the guidelines. Take advantage of the software program designed for homeowners to do all the calculations for you. Avoid making mistakes that could cost you the approval you need and deserve.

Don’t be frustrated and confused when trying to figure out how to qualify for HAMP.  Get the help you need to prepare your own accurate and acceptable loan modification application. The Complete Loan Modification Guide kit is the best selling do-it-yourself system that takes the guess work out of preparing your financial statement, hardship letter and all of the required forms your lender needs. You get an easy to use software program-Loan Mod Quick App-as well as an easy to understand handbook with step by step directions. Why take chances with your application? Simply input your unique financial information into the Loan Mod Quick App and it calculates it all for you! It couldn’t be easier-end the frustration-Visit myloanmodificationcenter.com and order today.