HOPE NOW is a private sector alliance of mortgage servicers, non-profits, counselors, and investors that have assisted many homeowners avoid foreclosure. They have developed a new program in conjunction with the U.S. Treasury, the Federal Housing Finance Authority, Fannie Mae, Freddie Mac and other mortgage loan servicers for “at-risk” homeowners.
The plan will go into effect on December 15, 2008.
The plan helps modify existing mortgages in an effort to keep homeowners in their home. The homeowner must be in arrears 90 days or more. The mortgages must be held by Freddie Mac, FNMA or other participating lenders/servicers.
How Does the Streamlined Modification Plan Work?
Upon obtaining homeowners detailed information, the plan will reduces the homeowner’s monthly payment to 38% of the borrower’s monthly income. The process could include all or some of the following to accomplish the reduction:
- Extend the term of the loan
- Interest rate reduction
- Principal forbearance
If the above procedures do not work, the plan offers alternative case by case review to determine what options are necessary to avoid foreclosure.
HOPE NOW
The HOPE NOW alliance has proven success this year in contacting distressed home owners to encourage them to work things out. They offer a toll-free hot line at NO COST to callers in need of advice. To learn more about HOPE NOW visit the website,
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4 Comments
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My opinions of the program.
How about if you are struggling with your payment but you are current and have a high rate and are under water?
Just go 90 days, get a great rate and then dispute the 90 day lates on your credit report.
I would tend to agree with Fred. While I think the idea behind what they are doing is fantastic, I applaud everyone that tries to offer a helping hand. But there seems to be too many potential loopholes, which as many of us know will be exploited and used to other peoples advantages.
The problem with programs like these is that they never actually get to the people that need them, but rather they are used by people determined to abuse the system. I hope I am wrong and that this does work, but past programs lead me to believe otherwise.
jessica @ real estate licenses last blog post..5 Tips to Becoming an Even Better Real Estate Agent
Fred ~ I hear what you are saying, but I fear telling people to default will come back to bite me. Who knows what the future will bring with credit ratings. What if they need something and can’t get it due to bad credit?
Just the same the bailout plans are rewarding people for bad behavior, meaning we will just get more bad behavior.
Jessica ~ Your point is well taken, there are loopholes everywhere.
This program doesn’t appear to work in many instances because it requires a 90% loan to value.
If homeowners had a 90% loan to value they could sell the home.
Most people in trouble today are there because the value of the home is much less than the loan. Those are the ones who need a modification plan.
No one is helping them…yet.