(FHA mortgages only) (Some Freddie Mac Investor loans)

Definition: This is a loss mitigation option that allows a borrower, with help from a lender, to get an interest-free loan from HUD to bring their mortgage payments up to date

You may qualify if:

1. Loan must be 92 days delinquent (4 full payments due and unpaid).
2. Mortgagor must have overcome the cause of default.
3. Owner-occupant committed to continuing occupancy as primary residence.
4. You are able to begin making full mortgage payments.

When your lender files a Partial Claim, the U.S. Department of Housing and Urban Development will pay your lender the amount necessary to bring your mortgage current. You must execute a Promissory Note, and a Lien will be placed on your property until the Promissory Note is paid in full.

The Promissory Note is interest-free and is due when you pay off the first mortgage or when you sell the property.

For more information on this option you may contact:

National Servicing Center

Email: hsg-lossmit@hud.gov

1-888-297-8685

http://www.hud.gov/offices/hsg/sfh/nsc/rep/pcfact.pdf

For more information and coaching: Avoid Foreclosure eBook

Originally posted 2008-07-01 11:35:24. Republished by Blog Post Promoter

(Available on a very limited number of VA loans with lender and/or investor approval) (Called Recast for FHA)
Definition: A restructuring of loan that could result in a lower interest rate, extending the term of your loan, thereby lowering your monthly mortgage payments.

If you have incurred a long term financial hardship and can afford a new agreed upon payment, this might be an option for you. A loan modification is a permanent change to your mortgage. There are costs and fees associated with a modification that you will be responsible for. All property taxes must be current or you must be participating in an approved payment plan with your taxing authority to be eligible for a modification. Any additional liens or mortgagees must agree to be subordinate to the first mortgage. All requests are subject to your lender’s approval.

A loan modification is easier to arrange prior to the Mortgage Company filing a foreclosure lawsuit. Some lenders will not consider this after filing, but it’s worth trying.

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Originally posted 2008-06-24 11:53:22. Republished by Blog Post Promoter