With so many Americans struggling to keep up with mortgage payments in recent years, many companies have sprung up who offer help with this problem, for a fee. While some of these companies are reputable, many of them are running a scam, and all of them are offering services that you could receive for free through the mortgage counseling programs offered by the US Treasury Department and HUD. These free programs provided by the government can help you to keep your home, avoid foreclosure, and/or sell your home if necessary.Home Affordable Unemployment Program (UP): This program offers a mortgage suspension or reduction for at least 12 months for those who are unemployed and seeking reemployment. Home Affordable Modification Program (HAMP): If your financial situation has changed and you’re having trouble making your monthly mortgage payment, the HAMP program can help. It can lower your monthly payment to equal 31% of your gross monthly income. On average, this saves homeowners 40% on their mortgage payments. If you have a second mortgage on your home, you may also qualify for a modification under the Second Lien Modification program (2MP) when your primary mortgage is restructured through HAMP. Home Affordable Refinance Program (HARP): Homeowners who are current on their mortgage, but who have been unable to refinance because they’re “upside down” in their mortgage can get help through HARP. This program may allow you to take advantage of lower interest rates and reduce your monthly payment. Principal Reduction Alternative (PRA): If your home is worth significantly less than you owe on it, your loan servicer may be able to reduce the amount you owe on your home through the PRA program. Home Affordable Foreclosure Alternatives (HAFA): For those who need to get out of their home because it has become unaffordable, foreclosure is not the only option. A short sale or a deed-in-lieu of foreclosure could offer you some managed exit strategies. Redemption Period: If your home has already been foreclosed on, you may still be able to keep it. You can still reclaim your home after it has been sold at a foreclosure sale during the redemption period; however, you are to pay the outstanding mortgage balance and foreclosure costs in full. The wide variety of assistance programs available to homeowners who are struggling with their mortgage offer some great options for getting on top again. For more information about these and other programs, and how to qualify and apply, visit the HUD.gov website, and review their tips for avoiding foreclosure.
Source: HUD.gov website at http://portal.hud.gov/hudportal/HUD?src=/topics/avoiding_foreclosure.