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Where to Get Help for Loan Modifications

Many distressed homeowners are scrambling to find ways to avoid foreclosure or to help them cope with their mortgages in a down economy that has depressed home values. Fortunately, homeowners can get help for loan modifications through government programs and banks that are eager to prevent a further breakdown of the housing market.

Determining where to get help for your loan modification does not have to be a difficult task, as there are a number of avenues you can take to find a suitable program or to enlist the aid of a professional.

The HAMP Program

There are government programs designed to assist "underwater" homeowners in reducing their monthly payments and to enable them to remain in their homes. These programs include the Home Affordable Modification Program, or HAMP, which is part of the Making Home Affordable (MHA) program initiated in 2009. Some of the reasons for implementing this program were:

  • Senior citizens were vulnerable to loan scams and thieves.
  • Low income homeowners or those with bad credit had few options available.
  • Predatory loans were forcing people into foreclosures.

The HAMP program can help such homeowners modify their mortgages by lowering their interest rates, extending the duration of their loans, or by reducing the unpaid principal if they meet certain requirements:

  • They are the primary residents in their homes.
  • Their present mortgages originated before January 1, 2009.
  • Their unpaid loan balances are less than $729,750.
  • They owe arrearages or face the probability of falling behind on payments and have considerable debt.
  • They have hardships that are well documented.
  • They have secure jobs and/or income that can meet the modified payments.

Extending HAMP

The government has extended the program to include unemployed homeowners who meet HAMP's requirements by asking lenders to grant a forbearance on the mortgages of these homeowners to equal any amount over a 115-percent loan-to-value ratio to bring the monthly payment to 31 percent of the homeowner's monthly income. Unemployed homeowners who qualify for unemployment benefits but who cannot find work may still be considered for a regular HAMP loan modification in the HAIFA program.


There are other programs that the government has instituted such as the Home Affordable Foreclosure Alternatives Program, or HAFA, for homeowners who may not have qualified for a HAMP loan modification. This program makes it easier for you to have a short sale and to settle your mortgage dues.

Hire a Legal Professional

The most secure way to get help for a loan modification is to retain a real estate lawyer who is experienced with government programs such as HAMP and HAFA and who has successfully negotiated loan modifications with lenders. Your attorney can advise you if and how you qualify for HAMP, if negotiating with your lender is a viable option, or if a short sale or other alternative is best for your particular situation.