What is HAMP and how does it affect foreclosure in Florida?
The federal government has responded to the increase of foreclosure in South Florida and across the nation by developing the Home Affordable Modification Program (HAMP) as part of the Making Home Affordable initiative. HAMP is a loan modification program designed to help homeowners with making their mortgage payments affordable and avoid foreclosure in South Florida.
Eligibility for HAMP involves:
- owning and occupying a 1-4 unit residence;
- owing $729,750 or less on your home;
- having financial circumstances making it difficult or impossible to make your mortgage payments;
Affordable Mortgages Under HAMP
If you have officially received approval for a loan modification under the Home Affordable Modification Program (HAMP), your loan servicer will make sure that your new monthly mortgage payment is no more than 31% of your monthly income.
The strategies used to lower your mortgage payment under HAMP include the following:
- Reduction of your interest rate – a rate as low as 2% is a possibility. In return for the low rate, the U.S. Treasury Department extends financial incentives to your loan provider. This doesn’t mean that everyone who qualifies for a HAMP loan modification will get 2% interest rates. If a 5% rate is sufficient to lower you mortgage to an affordable payment, then a 2% rate would not be necessary.
U.S. to pay off mortgage investors
U.S. to pay off mortgage investors
Treasury Department announces new mortgage incentives for lenders, which will reduce monthly payments for millions of borrowers.
WASHINGTON (Reuters) — The U.S. Treasury Department will Tuesday tap a $50 billion housing rescue fund to pay off mortgage investors and reduce monthly payments for millions of borrowers, said a senior administration official.
Mortgage servicers that own a small stake in costly loans will receive a cash payment to either erase the debt or agree to accept a reduced return on their investment.