In this article we will explain the steps an individual needs to take when pursuing a loan modification under the government’s Home Affordable Modification Program (HAMP), which is also commonly referred to as the Making Home Affordable Program or MHA. Please keep in mind that this program is must definitely not guaranteed and there are traditional in-house modification programs available if you are denied permanent assistance.
First you must complete the request form, which is a request for a modification and Affidavit. This will give information to your servicer of your mortgage about your home and your personal financial situation. The instruction guide is downloadable here . After the form is completed, print 2 copies. The first one is for your records and one is to send to your servicer. The request form must be signed by all the borrowers.
For the second step you must complete the Tax Authorization form. This form will give permission to your mortgage servicer to request a copy of your most recent tax return. Here you will find instructions on how to complete the form. This form also must be made into 2 copies. Of course one for your records and one for your servicers. With this form, only you, the taxpayer is required to sign the tax form.
In this step you must gather your proof of income. Your income is required to be verified by your mortgage servicer to make sure that the mortgage being modified will have affordable payments that you’ll be eligible to pay. The link above gives a checklist of documents that are needed to be provided if you are a wage earner, self employed or receive some kind of retirement income. Make copies of these as well.
Next, you’ll be sending the documents to your mortgage servicer. After the Request Form and tax Forms are completed, printed and signed, you’ll want to send these documents along with your personal proof of some source of income to your mortgage servicer. You can find the correct mailing address and fax number of your mortgage servicer here.
List of Requirements
– Hardship letter
A letter describing your hardship that has lead you to request a loan modification is always required. This is an essential piece of information that will help your mortgage servicer to determine if you qualify for the program. You do have to get across your story, but is critical you do not exceed any more than 2 pages as lenders are reading these daily. Several great examples of hardship letters can be found right here on LoanSafe.org.
-Proof of income
To verify this information your mortgage servicer will need:
* Records of your salaries and hourly wages(the 2 most recent pay stubs)
* Your records of unemployment, social security, disability benefits ext. Copy of statement or letter from the provider that states the total paid and how long you’ll be getting the benefits, or two most current bank statements to confirm the income being received.
* Any Alimony or child support payments. With this you’ll need your copy of the divorce decree, separation agreement, or other agreement that was recorded in writing and filed with the court. The two most recent months of bank statements showing this payment can also be provided.
Avoid foreclosure scams!
Remember to always be wary of foreclosure rescue scams out there. Scams are an on-going problem that’s never going to end, and these unscrupulous practices can cost an individual thousands of dollars.
The definition of a scam is a promise that the scammer does not follow through with. Typical foreclosure rescue scammers will ask for money upfront and than not come through with full, or any service that they promised.
The federal government provides all sorts of programs for all of the help you may need. The Homeowner’s HOPE Hotline can be reached at 1-888-995-4673 for all the information that you could possibly need on the Making Home Affordable program. You may also talk to a HUD approved housing counselor at this number.
Tips to help you avoid loan modification scams:
1. Stay wary of anyone who may ask for you to pay an upfront fee in exchange for a counseling service or a to good to be true modification of your delinquent loan.
2. Scam artists frequently go for homeowners who might be really struggling to keep up with their mortgage and are vulnerable enough.
3. Be extra wary of people who are trying to get you to sign any papers far before the modification or agreement.
4. Always read what your signing!
5. Never sign over your property to someone or an organization, especially if they promise to get your mortgage company to forgive your debt
6. Never make a mortgage payment to anyone but your mortgage company, without their approval first
If you have been a victim of an unscrupulous loan modification firm:
Know that applying for the Making Home Affordable Program is free, and there’s plenty of information out there that can prove so. If at any time you believe that you are a victim of any scam, you can file a complaint with the Federal Trade Commission. You may email them, from their online website, or call 1-877-382-4357, for assistance in Spanish and English.