Obama's New Loan Modification Plan Helping People with Their Home

With so many foreclosures today, many homeowners are looking for help with their home loans. The Obama's refinance plan has put out a $75 billion for people facing the foreclosure. However this does not mean that every American can get the services, it strictly for people who will qualify for the program. The money for this loan modification program is sourced from the $700 billion Tarp I that was agreed in late 2008 in the Bush Administration. The home loan modification is supported by Freddie Mac and Fannie Mae. One can refinance their homes with little or no equity; they can now get a loan for till 105% of the home's value.

The home modification loan will be supported by Freddie Mac and Fannie Mae. People can get loans up to 105 percent of the homes market value and they can qualify with or without home equity. With the intention of receive the mortgage loan modification loan, you have to show how you are having a hard time paying your mortgage back due any seen or unseen hardship like accident or lose of job. The whole idea is to help families keep their homes, thus it will not be given on any home that is not a primary residence. It will lower down the person's mortgage by 38 percent of their gross monthly income. The first preference would be given to reducing the interest rate first till 31 percent, and then the loan will be extended to 40 years. If this still does not fall within the 31 percent of the family's gross income, then the principal amount would be paid without interest.

There are cash incentives for the lenders and banks to encourage them to offer mortgage refinance. They will be getting $1,000 for every modification and added $1,000 payment each year for three years, as long as the borrowers are making payments. All the homeowners with a principal amount less than $729,750 are entitled as long as the home in question is their primary house.

For further information you can speak to lender who represents Fannie Mae or Freddie Mac. If you can modify your mortgage instead of losing out your home. With a modification in hand, you can get better terms and conditions along with more affordable payment structure.