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  •  US Bank Home Mortgage Assistance Programs; Relief Programs for Homeowner

    One of the top lenders in the country, US Bank is now offering mortgage help for homeowners who are struggling to make ends meet, missing mortgage payments, or who owe more on their property than it is worth.  Some, such as HARP and HAMP are government sponsored while other options are unique to US Bank.

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    The first option, a US Bank Repayment plan, allows a homeowner who has missed payments in the past to pay these past due amounts in monthly installments.  The US Bank Repayment plan is a viable option if the homeowner has extra funds at the end of each month and can apply these funds towards the mortgage plus the repayment amount.  US Bank offers an online link to determine what repayment plans are available, and which is best for the homeowner.

    Another US Bank mortgage relief program is the Hardship Loan Modification.  US Bank will combine all overdue interest and principals due because of missed payments and add them to the term of the loan, thus extending the loan.  A 30 year loan, for example, might be extended to a 30 year four month term if the mortgage payments are four months behind.  This is more appropriate for a homeowner who doesn’t have extra money at the end of the month but can cover mortgage payments and applicable fees.

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    The Obama administration has increased efforts to assist owners remortgage their house loans, often times bringing relief to a lot of individuals that owe a lot more than their houses are priced. This is an late move that should strengthen consumer spending, even though it will probably not avoid 1000s of property foreclosures. The latter downside necessitates additional aggressive and successful loan modifications, which usually financial institutions and backers have been completely hesitant to do – to their own personal hinderance.

    The fall of the housing market has left an estimated 14 million People owing more on their home loans than their houses are effectively worth. Though about seventy % of the “under water” debtors have financial loans with interest levels greater than can be found nowadays, the absence of security has kept them from re-financing into different, less costly loans.

    On Monday, Fannie Mae Mae, FreddieMac and their regulator, the FHFA, announced a more ambitious refinancing program that might allow another two million under water debtors that are not in arrears to obtain new products. These re-financings will probably decrease the dividends that Fannie Mae, Freddie and various investors were standing to obtain from the financial products, but that’s the typical associated risk experienced by individuals that purchase mortgage backed securities. More significant, by reducing homeowners’ financial debt repayments, the refinancings can increase consumer trust and maximize spending, driving ahead the country.

    The decrease in monthly bills should likewise prevent some home owners who aren’t in arrears these days from going into property foreclosure. But it really won’t give much support to the believed .2 million people Moody’s Analytics expects to lose their homes in 2012. Loan companies could cut their losses increasingly by changing mortgages to decrease the monthly bills of defaulting men and women, and they’ve attempted a range of techniques with limited success. But they have been against at what authorities say would be the most efficient action – writing off part of the customer’s debt – as it features a higher upfront cost. Lenders also say there is a moral danger in bailing out credit seekers that are not able to repay the money they owe.

    The reason why won’t Fannie Mae and Freddiemac put down mortgage loan amounts? You will discover three wide factors. First, the firms warrant $5 trillion in mortgage products, of which close to 20 % are under water. However the vast majority of these underwater mortgage loans close to 87% for FreddieMac are up-to-date. The firms are hesitant to reduce loan balances because of a concern that will produce a moral hazard that causes other people to go into default.

    Second, Mr. DeMarco claims that the companies existing efforts to switch house products are successfully lowering borrowers monthly bills to cheap levels without the pricey step of forgiving financial debt. Fannie Mae and Freddie are guaranteed totally by tax payers and have amassed a $145 billion tab thus far, and the FHFA is charged with conserving the firms’ assets. In a recent interview, Mr. DeMarco said that principal forgiveness isn’t called for considering the fact that mandate.

    Third, a lot of under water mortgages frequently are covered by home finance loan insurance, which reimburses Fannie and Freddie for portion of the damage any time those financial loans go delinquent and move through foreclosure. The result is the fact even just in cases when it could build economical wisdom for that mortgage to be have its principal reduced, it still isn’t in the economic interest of Fannie or Freddie to write down certain mortgages.

    Why aren’t Fannie and Freddie part of the foreclosure settlement? Just as Fannie and Freddie don’t even make products, additionally they don’t handle the day-to-day management of those products, or what’s named “mortgage servicing.” Instead, they count on countless corporations, but mainly great banks, to service their products. They launch detailed directions with what methods servicers have to take, together with timelines they should fit to foreclose on consumers that haven’t qualified for just a home finance loan modification.

    The existing property foreclosure funds are focused on financial institutions that didn’t effectively service home products. While Fannie Mae and Freddie, the 2 main largest sized house loan investors in the U.S., plainly couldn’t stop the enormous crisis in mortgage servicing (and some have contended they turned a blind eye), the businesses by themself don’t service house products. That’s one massive grounds they aren’t a party to the arrangement.

    What could the settlement accomplish? Beneath the terms and conditions currently being talked about with banks, they would need to pay close to $25 billion in penalties or fees. Around $5 billion is paid in income. Another $3 billion could be expended by mortgage refinancing upside down applicants whose financial loans are on the banks’ account books. The residual $17 billion can be spent on housing relief efforts, generally by writing down mortgage loan balances for under water applicants who’re struggling to produce their payments.

    Could the negotiation apply simply to financial loans that lenders own? That’s still up in mid-air. To start with, the Federal government had pushed for the arrangement to require lenders to write down mortgage loan balances for borrowers whose financial products they maintained but didn’t own. The reasoning driving that move was that traders, in conjunction with people, were being hurt by servicers’ inability to correctly handle affected products.

    Although lenders have clearly resisted that tactic as it would likely involve them to really pay financiers. As an alternative, the latest negotiation talks have concentrated on permitting institutions to pay their fees by writing down mortgage loan balances on home financial products that they maintain on their account books. Close to 20 % of all mortgages in the U.S. are held on bank balance sheets.

    The State of Vermont introduced a battery of rules and regulation changes to help streamline the financial industry and protect homeowners who are at risk of losing their homes. An important element in the protection of Vermont homeowners is the Vermont Mortgage Assistance Program.

    The Vermont Mortgage Assistance Program is managed by the Vermont Banking Division and is responsible for providing advice, information and assistance to residents who have been affected by the mortgage crisis and who are struggling to make mortgage payments. However, it is important to note the Mortgage Assistance Program does not have any actual funding to provide cash payments to borrowers. Nevertheless, the Mortgage Assistance Program can help by providing quality advice and by facilitating the communication between borrowers and lenders.

    According to the information provided at the Vermont’s Mortgage Assistance Program, the most important thing to know when you are facing mortgage issues is that time is of the essence. The sooner you deal with your delinquency problems the more options you have and the more likely you are of saving your home from foreclosure.

    A foreclosure will typically take six to nine months to complete. This is important because even if a lender is willing to try and negotiate a settlement, it is unlikely the lender will stop the process while the settlement is negotiated.

    The Vermont Mortgage Assistance Program also offers mediation services between lenders and borrowers. It also provides advice on how to arrange for loss mitigation with your lender. Loss mitigation is a negotiation between borrowers and lenders that studies the options a borrower has to restitute payments in arrears while reducing payments to a level that is affordable and realistic considering the financial situation of the borrower.

    If your borrower is not willing to negotiate a solution, the Vermont Mortgage Assistance Program can help you get in touch with local institutions that offer refinancing options to borrowers. A government program that offers refinance and mortgage modification options is HOPE, which may be a useful resource.

    Another point highlighted by Vermont’s Mortgage Assistance Program is the fact that in some cases losing your home is the best alternative. Trying to save your home at all casts may perpetuate a bad investment you can’t afford and are better off without. The program can suggest foreclosure alternatives that provide the least damaging alternatives for your credit rating.

    Contact the Vermont Mortgage Assistance Program by clicking here or calling (802)-828-568-4547.

    Hawai Mortgage Help

    The Department of Hawaiian Homelands DHHL accepts applicants who wish to participate in programs which help those who qualify for aid that is Native Hawaiian Families who have an income of 80% or less of the HUD local area average. They must also be eligible to live in Hawaii. The applicants who wish to develop programs with the aim of helping in this regard can be local, non-profit or for-profit organizations. The programs can receive funding grants starting at $10,000. The programs can be eligible for funding if they are for Development including making affordable housing available, giving down payment or closing cost loans or direct lending.

    Housing Services which could include payments to prevent foreclosure. Housing Management such as loan processing and managing projects for affordable housing. There are other categories too. The Projects are to help the beneficiaries who meet the requirements over a year or more if necessary and must be related to the DHHL Native Hawaiian Housing Plan objectives. These objectives include making reasonably priced housing available for Hawaiian families of low income.

    To understand the process of home buying and especially of first-time home purchase Homebuyer Education is vital. In Hawaii, those who are not too seriously disadvantaged financially and who can with the help of a counselor go through the necessary steps to property purchase, are directed to Level 1-Basic Management Homebuyer Education. Clients at level one will find that within six months to a year they are prepared to manage a mortgage. They are helped to prepare a plan of action, to develop a budget and shown how to achieve better credit scores. Aid is provided toward debt reduction as well as improving savings and income so that once they are on track with a mortgage the counselor won´t need to do very much to help the client to successfully buy the chosen property. If the client needs longer than a year to be prepared to take on a mortgage then the Level 2 Intensive Case Management Homebuyers Education Program is followed. The counselors will help the client to improve his credit rating and greatly reduce his debt as well as to save money and earn more so that the mortgage loan is a possibility.

    This is the same as in Level 1 but it will take more time to achieve the desired result. Due to the present financial crisis it is increasingly difficult to access credit and to qualify for a mortgage people have to meet quite strict qualifications. For this reason Post Home Ownership Counseling and Lease Cancellation Prevention is very important for those who are for the first time taking steps to buy a house. Counseling is available so that clients can be prepared in advance and ready to deal with financial difficulties such as losing employment, medical expenses or heavy debt. So that they can adapt successfully to the situation and avoid foreclosure service providers will help find different solutions toward financial planning which will go a long way to prevent mortgage foreclosure or lease cancellation. Hawaii is in this way helping Hawaiians become responsible homeowners.

    The state of Mississippi knows that one of the main difficulties people face when trying to find a suitable home is the upfront money needed for the down payment. People require help in this regard and also when it comes to the payment of closing costs. For this reason the Mississippi Home Corporation has arranged for a Down Payment Assistance Program designed to help those of low to moderate income to buy their first home. First time homebuyers with a low or moderate income and who have an acceptable credit rating are eligible if they meet the credit eligibility requirements and have need of a second mortgage to pay the down payment.

    They are also required to complete an 8 hour homebuyer training course.

    The Down Payment Assistance Program consists of a first mortgage (FHA, VA, or RD qualifying guidelines) and a second mortgage with a ten year fixed rate f 7%. The maximum down payment assistance is 3% of the loan amount and it can be used for closing costs too. It is required that the applicant´s liquid assets not exceed $4,500. The property must be the primary residence of the owner.

    The Mississippi Home Loan Plus Program Grants of up to $14,999 are available for low income homebuyers who meet the requirements. The funds provided to the Mississippi Home Corporation (MHC) by the Mississippi Development Authority(MDA), Community Service Division are to make it possible for those who otherwise could not purchase a property of their own to acquire their first home. There are certain requirements that are to be met in order for the grant to be awarded. For example the property to be purchased must meet section 8 Housing Quality Standards so must have written clearance from a US HUD approved appraiser or it must meet local housing quality standards in areas that have their own local building codes. It should be noted that the whole County of Harrison and the City Hattiesburg as well as the City of Jackson are not eligible for this program. The grant can be used with the MHC programs Mortgage Revenue Bond with no cash advance (MRB) and Mortgage Credit Certificate(MCC).

    The applicant must be a US citizen or qualified registered alien who has a social security card and it is required that the homebuyer have Homebuyer education with a housing counselor approved by HUD. The household income must be below 80% of the average household income according to the size of the family. The limit as to Purchase Price is $150,000. The buyer must purchase the property by permanent fixed-rate mortgage through a lender approved by MHC. As for the property itself it must be located in an area that is eligible for the grant and it must be the primary residence of the buyer. The home to be purchased must not be in a flood zone. To qualify the property has to be a site built single family home. Condos and town homes do qualify. If the construction is newly built it must be complete. Properties built before 1978 will be subject to a lead based paint inspection and test. Anyone who would like to participate in the program can find a participating lender list as well as a homebuyer guide on line.

    News of the approval by the House of Representatives of the Emergency Homeowners Loan Program has fed the hopes of those that though the program would never start. Now only the signature of the Senate remains, many unemployed workers who are at risk of losing their homes to foreclosure may again put their hope in a mortgage assistance program that can see them through their temporary financial difficulties until they find work again.

    However, not all states are participants in this unemployed workers mortgage assistance program, up-to-date only 27 states were part of the scheme. These states included Alaska, Arkansas, Colorado, Hawaii, Iowa, Kansas, Louisiana, Maine, Massachusetts, Minnesota, Missouri, Montana, Nebraska, New Hampshire, New Mexico, New York, North Dakota, Oklahoma, South Dakota, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming and Puerto Rico.

    Since the news of the approval of the House of Representatives, five more states have announced similar programs which will also receive funding through the Dodd-Frank Act. The Housing and Urban Development Department will also have a monitoring and supervisory role in these programs, although it will delegate most of the management roles to state level agencies (both governmental and non-profit community organizations). These states include Pennsylvania, Maryland, Connecticut, Idaho and Delaware. Although they are not part of the sates that applied for the Emergency Homeowners Loan Program the programs they are now offering their citizens are very similar. Since April 2011, they have accepted applications from unemployed workers who are delinquent on their mortgages. To qualify, an unemployed worker must be at least 3 months behind in his mortgage payments and have received a notice from his lender warning her of the intention of foreclosing on the mortgage.

    Successful applicants will receive bridge loans of up to $50,000 to help them cover late payments, insurance, tax and ongoing mortgage payments for up to 24 months. The programs are restricted to unemployed workers who have a debt to income rate of 55 percent of less. This means the total monthly housing payments must represent less than 55 of their total income. For example, a household with an income of $4,000 a month, must not pay more than $2,200 in mortgage and other housing expenses.

    These five states also have similar assistance programs under their respective housing finance agencies, which has moved the Housing and Urban Development Department to allow them to start accepting applications before the other 27 states which are part of the EHLP.

    The California Housing Finance Agency is California’s main housing agency. It has several mortgage assistance programs designed to both help first-time buyers purchase a home and assist those that already have a home keep it. Those programs designed to protect Californian homeowners from foreclosure are under the Keep Your Home California program, which provides up to $2 billion in cash for foreclosure prevention programs. However, previous eligibility criteria was too stringent to allow many struggling homeowners qualify for assistance. The California’s Housing Finance Agency has reduced the requirements of these programs to help more struggling homeowners benefit from them.

    Unemployed Workers

    Under the new rules unemployed workers who are at risk of losing their homes can request federal mortgage assistance of up to $3,000 a month. Similarly, homeowners who are facing financial hardship can apply for up to $15,000 a family to reinstate mortgages at risk of foreclosure. Even homeowners who have no choice but to let their homes go can apply under the new rules for assistance for relocation expenses. These and many other changes have been backdates to mortgages originated after January, 1, 2009. This means that even if your application for help previously put down, you may reapply and see it approved under the new rules.

    These changes have come after the California Housing Finance Agency collected information on the existing programs and identified the areas where improvements were required. One of the main factors considered were the ongoing high-rates of unemployment in California which increased the risk of households, which had previously being regular with their mortgage payments, would lose their homes to foreclosure.

    The California Housing Finance Agency acts  as an intermediary between the Housing and Urban Development and servicers in some programs and as principal program manager in others. The servicers used by the CalHFA include the Guild Mortgage, GMAC, the California and the Department of Veteran Affairs. Funding for the programs originates from the Housing and Urban Development Department and the Dodd-Frank Act. Funds of up to $1 billion have been assigned to unemployed workers struggling to pay their mortgage and over $450 million will go to the State of California. Other states that have relaxed the eligibility criteria of their mortgage assistance programs and will receive assistance from the Dodd-Frank Act include Delaware, Idaho, Pennsylvania and Maryland.

    One of these programs, is the Emergency Homeowner Loan, which is available for unemployed workers who had an income of 120 percent the median income and who had seen their income drop by at least 15 percent since they lost their job.

    It seems like the much-awaited Emergency Homeowner Loan Program may still see the light of day. It was deemed overdue when it was first conceived in the beginning of 2010 and it is considered much more so in July 2011. Yet, after it was approved in the House of Representatives in March 2011 it only awaits the signature of the Senate for approval. There are thousands of unemployed workers which await this (or any other) program to assist them with their mortgage payments. If passed by the senate


    the program will provide loans of up to $50,000 (estimates set the average loan at $35,000) to around 30,000 unemployed workers. Who will receive this assistance? What are the requirements or eligibility criteria for this mortgage assistance program? Although some of the details have still not been published, the Department of Housing and Urban Development has provided a summary with the main requirements applicants must meet to qualify for bridge-loans under the Emergency Homeowner Loan Program. This article will list and comment on these requirements.

    Income

    Obviously, this program is not targeted at the wealthy or those with enough assets to care for themselves. In order to focus the target group of the program, the Department of Housing and Urban Development has limited the scheme to unemployed workers which had a household income equal or less to 120 percent of the area median income (AMI) in their region. This income includes, wages and salary workers as well as self-employed workers. For example, the area median income of San Francisco, California, in 2010-2011 was $93,400. Only applicants with total incomes of $112,080 or less can apply for this program.

    However, the total income is not the only income requirement. Applicants must also have seen an income reduction of at least 15 percent since they lost their employment. If there has not been a significant reduction in income since unemployment the unemployed worker must use the income available to him to continue paying the mortgage.

    Delinquency

    Applicants must be already three months or more behind their payments and must have already received a notice from their lenders informing them of an intention to foreclose on their mortgages. Proof of this may consist of any type of written notification between the lender and the borrower that indicates three months have gone by since the last mortgage payments were made and the intention to foreclose on the mortgage.

    Ability to Repay

    The applicant must also be reasonably likely to repay the mortgage within two years of entering the program. This is determined by the total debt to income ratio of the applicant. To qualify the debt to income ratio of the applicant must be below 55 percent. For example, if your monthly income is $2,000 your housing costs must be below $1,100 a month.

    Residence

    A final requirement for all applicants is that they must live in the home they are requesting financial help for as their main place of residence. This program cannot be used for investment or vacation homes.

    Our previous article gave a summary of the new Emergency Homeowner Loan Program; this article will provide more details on this long-awaited and exciting new scheme for unemployed workers struggling with their mortgages. The scheme is funded by the Dodd-Frank Wall Street Reform and Consumer Protection Act. Funds already allotted for the program amount to $1 billion, which analysts from the Department of Housing and Urban Development estimate will suffice to provide assistance to around 30,000 struggling homeowners with loans averaging $35,000.

    The Loans

    The loans provided by the Emergency Homeowner Loan Program will work as as bridge loans to struggling homeowners to help them pay delinquent taxes, arrearages and insurance payments and up to 24 months of mortgage payments, interest and mortgage insurance premiums, as well as taxes and hazard insurance. This program is especially designed to help unemployed workers in states not covered by the Hardest Hit Housing Markets program. The scheme is set to start soon, as soon at is approved by the Senate. Already it is well overdue. It was set to start at the end of 2010 and was only approved by the House of Representatives in March 2011. The states that will benefit from the program include Puerto RIco and 32 other states. Of the 32 states 27 will benefit directly from the scheme and 5 will manage their own versions of the program.

    Management

    The Department of Housing and Urban Development will delegate the management of the scheme to non-profit local community agencies and to state housing finance agencies (HFAs), who in most cases already manage similar programs to help struggling homeowners. However, the Department of Housing and Urban Development will still retain monitoring and note management functions over the scheme.

    Funds

    The funds allocated to the program will be divided among participating states based on their share of unemployed homeowners with a mortgage. California, Florida, Illinois, Ohio, Michigan, Georgia and New Jersey will get the lion’s share of the funds. California is the state that will receive more funds: $476.2 million. Double the amount the second state in the list, Florida, will receive—$238.8 million. Indiana, Tennessee, Alabama, South Carolina, Kentucky, Oregon, Mississippi, Nevada, Rhode Island and Washington DC will all receive less than $100 million. Rhode Island and Washington will only receive $13 million and $7.7 million respectively. 

    The program cannot come soon enough for unemployed workers who see their chances of saving their homes evaporate with every week of unemployment. Thousands of unemployed workers with mortgages rely on this program passing through the Senate to allow them to restructure their mortgage payments and save their home from foreclosure. Who will qualify for this program? We will discuss that in our third and last article of this series on the Emergency Homeowner Loan Program.

    The Housing and Urban Development Department has created a new mortgage assistance program, the Emergency Homeowner’s Loan Program, designed to help unemployed workers who are struggling to pay their mortgages. This long-awaited program could be just what thousands of families needed to avoid foreclosing on their home loans. Although this program is administered on the local level, all participating states are following the same guidelines so they can be described jointly in this article. Five other states, Connecticut, Delaware, Idaho, Maryland, and Pennsylvania have their own unemployed workers assistance programs with similar services and features offered to homeowners. This article will look at what the program offers unemployed workers and how you can benefit from this assistance program.

    Participating States

    The participating states in this program are Alaska, Arkansas, Colorado, Hawaii, Iowa, Kansas, Louisiana, Maine, Massachusetts, Minnesota, Missouri, Montana, Nebraska, New Hampshire, New Mexico, New York, North Dakota, Oklahoma, South Dakota, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming and Puerto Rico. The program was created as a partnership between the United States government, and community partners throughout the country. One of the largest of these supporting partnerships is NeighborWorks America.

    This program was launched with funding from the Dodd-Frank Act, which set aside $1 billion dollars to implement the program. The program provides interest free loans to unemployed workers who are struggling with their mortgage payments. The maximum loan under the Emergency Homeowner’s Loan Program is $50,000. The loan can be used to pay for mortgage payments over a period of no more than 2 years. After a long waiting period since rumors of the program were first leaked by the Department of Housing and Urban Development, the program is set to launch as soon as the Senate signs the bill after the House of Representatives signed it in March of this year.

    Estimates and forecasts from the Department of Housing and Urban Development set the number of unemployed workers set to benefit from this program at 30,000 and the average loan they will receive at $35,000. As with most programs launched by the Department of Housing and Urban Development, HUD, they will be managed by other agencies with funds granted by HUD. In this case, the managing organizations will be non-profit community agencies, such as NeighborWorks America who are well placed in the community throughout the participating states to provide the help needed. The next article in this series will provide more information on the particulars of this program and how many funds were assigned to each state.

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