Obama Mortgage: Mortgage Modifications Stop Foreclosure

Obama’s Loan Modification Plan is intended to aid homeowners with home loan modification or refinancing for more manageable mortgage payments.

Sadly a bulk of the money goes to the banks and they’re not bound to heed. Only people who are up-to-date on their Obama mortgage and whose loans are through Fannie Mae and Freddie Mac are eligible for Obama’s Loan Modification Plan. The plan is leaving millions of U.S. homeowners in danger of dealing with foreclosure susceptible & out of the plan.

This federal plan is called Home Affordable Modification. Most banks are participating and when you call the Loss Mitigation Department or Home Retention Department of your lender, you must specifically ask for this program. Obama has mandated that during the review process, all foreclosure activity must be halted until a determination can be made if a homeowner qualifies.

If you are already in default, all hope is not lost. If you qualify for a mortgage loan modification through the MHA program, you can work out your back payments, have your late fees and penalties forgiven, and get a lower monthly payment. President Obama’s program could help turn your situation around, but the loan modification part of the program ends December 31, 2012.

How To Modify A Loan- When a loan modification application is turned in by a homeowner, it is carefully analyzed to decide the profitability to the investor or the possibility of loss. The “Net Present Value Test” is used to decide what will provide more cash flow to the investor-Foreclosure or Modification. The homeowner’s best interest is not part of the decision making process. It is purely based on what is more financially beneficial to the investor. If modification is not in the favor of the investor, they will deny your application.

Learn more about Obama Mortgage Relief Plan Qualifications.