Current Homeowners Take Note:
Govt Program; "Making Home Affordable"

We at Benchmark & Pratt thought that sharing this information would be a tremendous benefit to current home owners. Below are two fact sheets we have compiled for guidance. We've done our best to make them accurate, but you should also utilize this website (http://www.makinghomeaffordable.gov/) to help verify elligibility and use other sources to confirm details and get more comprehensive explanations.

MAKING HOME AFFORDABLE

Home Affordable Refinance Ends June 2010

Many homeowners pay their mortgages on time but are not able to refinance to take advantage of today’s lower mortgage rates perhaps due to a decrease in the value of their home.

1) Must be current on mortgage(not more than 30 days late in 12 months)

2) Refinance into a 30yr or 15yr fixed rate mortgage

3) Must be Fannie or Freddie sponsored mortgage(Call lender or mortgage servicer)1-800-7FANNIE WWW.FANNIEMAE.COM/HOMEAFFORDABLE OR 1-800-FREDDIE WWW.FREDDIEMAC.COM/AVOIDFORECLOSURE/

4) Must be owner occupant of a 1-4 unit home

5) Balance owed must be 105% or less of current market value

6) Must have stable income to support new payment

7) Rates will be market rates for 15/30 yr loans with no prepayment or balloon payments allowed.

8) Will not reduce principal amount. No cash out.

Documentation Needed: Household before tax monthly gross income Most recent income tax return Info on any additional mortgages (2nd or 3rd) Account balances and minimum monthly due on all credit cards Account balances and monthly payments other debts, student/car

MAKING HOME AFFORDABLE

HOME AFFORDABLE MODIFICATIONS

Many homeowners are struggling to make their monthly mortgage payments perhaps because their interest rate has increased or they have less income.

New Borrowers can apply up to December 31, 2012

1) Doesn’t have to be Freddie or Fannie. Mortgage Servicers given incentives by Treasury

2) Must be owner occupant in 1-4 unit

3) Principal balance equal to or less than $729,750 (FHA Limit)

4) Loan must have started before January 1, 2009

5) Present mortgage payment is more than 31% of gross pretax monthly income

6) Your present mortgage payment is no longer affordable maybe because of significant change in income or expenses

7) You don’t have to be behind in your payments

If you are behind more than 2 payments and your servicer is participating in the Making Home Affordable Program, your servicer must evaluate your loan to determine if you qualify for a loan modification

To determine a list of participating servicers go to www.financialstability.gov

8) Servicer will determine if your payments are over 31% of your income

9) Servicer will determine how much of an interest rate reduction necessary to bring you down to 31% (Can go as low as 2%) If that isn’t enough, servicer can extend loan to 40 years or defer payment of principal or forgive principal

10) Servicer put you on a 3 month trial at new terms, if successful, Servicer will execute permanent modification for 5 yrs. (fixed rate)

11) Servicer will escrow monthly amount for taxes and insurance

This is a 5 yr modification at a fixed rate. At beginning of year 6, rate may increase no more than 1% per year until reaches cap set in modification agreement. Cap is never higher than market rate on day your loan was modified.

Incentives provided by Treasury to Servicer and Borrower: For every month make payment on time, Treasury will pay incentive that reduces principal balance on your loan up to a maximum of $5000

Documentation Needed: 12) Monthly gross income of household

13) Most recent income tax return

14) Asset information

15) 2nd mortgage information

16) Account balances and minimum pmt on credit cards

17) Account valances and monthly pmts on other debt student/car

18) Letter describing circumstances causing income reduction or expense increase (job loss, divorce, illness)

If foreclosure scheduled, borrowers may contact a HUD approved housing counselor at 1-888-995-4673 to try to get in this program before foreclosure.