Obama's federal HAMP loan modification program is the home refinance program sanctioned by the Federal government to offer assistance to those who have experienced hardships or who have poor and bad credit. Federal HAMP loan modification is a common set of guidelines used by private lenders in order to address mortgages that would under normal circumstances not be able to be refinanced.
If you need a mortgage refinance, here are a few things to look for to see if may potentially qualify for a HAMP loan modification. First and most importantly, you will need to have had a recent hardship. This is the single most important qualifying factor in the Obama's HAMP loan modification program. Hardships can include loss of a job or a significant reduction in hours, a decline in the value of your home, illness or death of the primary income earner, military duty and other similar events. You will need to justify this hardship and it may actually be helpful to find a loan modification attorney or a mortgage broker or loan modification specialist who can assist you with this. This can't be stressed too much. To receive any of the benefits of the HAMP loan modification program, you first have to qualify.
Once you have established your hardship you are eligible for reductions in you current interest rate down to as low as 2%*. Current penalties and fees can also be eliminated and your term extended to 40 years. The purposes of all these changes are to get your mortgage payments to fall within 31% of your available income. They believe if your mortgage payment is within this range you will be able to continue with your payments and won't default. The whole purpose of a Federal HAMP loan modification is to prevent a default and the ensuing foreclosure.
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