The Federal Housing Authority or FHA does have modification options available
. However, these are not easy modifications to qualify for.
The FHA HAMP modification eligibility requirements:
How do I know if my loan is a Fannie Mae or Freddie Mac owned? You can visit www.makinghomeaffordable.gov webpage and click on loan look up.
1). 1-4 unit primary home (FHA insured)
2). You are at least 1 month behind but are not over 12 months behind
3). A new mortgager can be added to the HAMP mortgage as long as 1 existing mortgagor(s) is retained.
4). You must have not defaulted intentionally meaning: you have sustainable funds to pay the mortgage but did not do so.
5). This is your only home you own
6). Ownership due to death, divorce of current owners must be supported by legal documents.
7). Seasoning of current mortgage: meaning you have owned your home for at least 12 months and have made 4 monthly mortgage payments on time.
8). You must pass the 31% debt to income meaning: you are at or above 31% of gross income but are not less than 31% with a back end dti of (cannot exceed) 55%.
Some of the benefits to having an FHA loan modification, the value of your home is not part of the equation. With the HAMP program you have to pass the NET PRESENT VALUE (NPV) test, if you do not pass this test you will not get modified. However, under FHA there is no NPV test hence no appraisal of value. There is no minimum credit score required, but credit will be pulled to verify recurring monthly debt.
The reason being FHA is sometimes harder to qualify for is due to it being a last resort. So if you qualify for other types of assistance for example: (FHA special forbearance, loan modification, and partial claim). You will not be offered a FHA HAMP modification.
Remember these foreclosure prevention programs will run till the end of 2011. As I always stress in my articles is DO YOU'RE HOMEWORK! A little time doing some research and knowing what to ask will save you a lot of headaches and time.