It seems that President Barak Obama’s housing stabilization plan is starting to take off. Already, the loan modification scheme, which is the core foreclosure prevention measure under the housing stabilization plan, has helped thousands of distressed homeowners save their properties from bank foreclosure listing.
JP Morgan Chase’s servicing unit, Chase Mortgage has helped modify over 15,000 troubled loans. Furthermore, the Bank of America has notified through mail about 100,000 borrowers who are eligible to avail of the loan modification plan under the foreclosure prevention program of the Obama Administration.
Last March 4, when Obama announced the implementation of the plan to reduce the number of properties in bank foreclosure listing, he predicted that the program could help an estimated 4 million homeowners save their distressed properties from foreclosure.
The plan works by encouraging lending institutions to help at-risk or delinquent borrowers by reducing interest rates, allowing the total monthly mortgage payments not to exceed 31 percent of the gross monthly income of borrowers.
To become eligible for the loan modification plan, you must visit a government Web site and answer some questions that will determine your eligibility. The site will automatically tell you after you have answered five questions if you are a potential candidate for the loan modification under Obama’s foreclosure prevention program.
Potential loan modification candidates must have their properties purchased before January 1, 2009, they owe a mortgage debt of lower than $729,750, they are delinquent on their mortgage payments, their payment is over 31 percent of their monthly gross income and they are using their distressed properties as their primary residences.
Furthermore, eligible candidates must submit several documents, such as household income documentation, including tax returns, pay stubs, mortgage statements and savings account records, second mortgage paperwork, credit card bills and other debt information such as car and student loans.
Eligible homeowners must be prepared to write a letter explaining why they need help to avoid foreclosure. Valid reasons may include income or job loss, divorce and health problems.
According to foreclosure rescue counselors, a well-written letter explaining why you need foreclosure prevention assistance can make a big difference in obtaining a loan modification.
Meanwhile, under the plan, foreclosure prevention counselors are made available to help distressed homeowners save their properties from bank foreclosure listing.
Author Resource:-
John Cutts has been educated in the finer points of the foreclosures market over 5 years. Read bank foreclosures news at BankForeclosuresSale.com - Your online source for Foreclosures for Sale.
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