Loan Modification Requirements Under the
Home Affordable Modification Program
- The property you are seeking to modify the mortgage MUST be a owner occupied property (No investment or second properties).
- You must have sufficient documented income to support a modified payment.
- You must've had a financial hardship and be delinquent or at risk of imminent default.
- Your mortgage had to have originated on or before January, 1, 2009.
- You can only modify your first mortgage only.
- Your current mortgage payment is currently more than 31% of gross monthly income (expenses are not considered in the modification analysis).
- There is a three month trial period before the modification becomes permanent.
Documents needed for loan modification by the mortgage bank:
- Two pay stubs
- Two bank statements
- Tax returns (4056T)
- Hardship affidavit
- RMA (request for modification and affidavit)
HAMP “Waterfall"--Banks will start out with option #1 and work there way down the "waterfall" until the target mortgage payment of 31% of your gross income is reached.
- Take arrears and add to principal and recapitalize
- Cut interest by 1/8% steps to as low as 2%
- Extend loan terms by up to 40 years
- Defer portion of principal, interest-free, until loan is paid off.
**HSBC, Beneficial, Household, TD Bank did not take bailout money so there is no HAMP, although they have their own in-house loss mitigation departments and MAY modify your mortgage under similar circumstances as HAMP.