There are stop foreclosure government programs available depending on whether you are interested in a mortgage modification, refinancing, or selling your home with a short sale. The programs are voluntary. However, to receive government help to stop foreclosure both you and your lender must agree to participate in a stop foreclosure program. The following is a list of government programs:
- The Home Affordable Refinance Program (HARP)
- The Home Affordable Modification Program (HAMP)
- The Home Affordable Unemployment Program (UP)
- The Home Affordable Foreclosure Alternatives Program (HAFA)
- FHA Home Affordable Modification Program (FHA-HAMP). VA loans are being modified under different programs.
HARP
HARP is only available through June 2010 for qualified borrowers to refinance their home.
The program is available for Fannie Mae and Freddie Mac loans. If you do not know if your loan falls under those categories, you can contact your lender to find out. Eligibility requirements:
- Home must be your primary residence, owner occupied 1-4 units
- You must be current on your mortgage payments
- Loan to value ratio cannot exceed 125%
HAMP and UP
HAMP is available to borrowers who want to keep their home and obtain a mortgage modification to lower their payment and their interest rate. If you are unemployed, you may be eligible for the UP program under HAMP. HAMP and UP eligibility requirements:
- Your loan must have originated on or before January 1, 2009
- Your residence must be owner occupied and your primary residence 1 -4 units
- Your mortgage payment must currently be greater than 31% of gross income
- You must document your financial hardship
- The unpaid principal balance on your loan must be equal or less than: 1 Unit $729,750, 2 units $934,200, 3 units $1,129,250, 4 units $1,403,400
- If you are unemployed and were previously determined ineligible for a HAMP modification, or you are in a HAMP program and you have not missed three consecutive payments, you may be eligible for the UP program
- You must be able to document your unemployment
- You may be considered for a forbearance program if you have been unemployed for at least three months.
HAFA
Under the HAFA program, borrowers and lenders and loan servicers are given incentives by the government to participate in a short sale or a deed in lieu of foreclosure. A deed in lieu of foreclosure also qualifies under the program. Eligibility requirements:
- You must have been turned down for a modification under the HAMP program
- You are delinquent under the HAMP program
- You must request a short sale or a deed in lieu
Incentives include $1,500 payment for lenders and loan servicers and $3,000 relocation assistance for the borrower. The lender must release you from any debt when the transaction closes. This prevents the lender from obtaining a deficiency judgment against you.
FHA-HAMP
To qualify under the FHA-HAMP program, you must have an FHA insured loan. Other guidelines are basically the same as the HAMP program.
Consult with a Foreclosure Defense Attorney
It is recommended that you consult with your attorney regarding the various government foreclosure prevention programs to determine which is the best option for you. The attorney can also advise you of other options to prevent your home from foreclosure. An attorney can help you negotiate a solution with your lender.
