Earlier FHA started the FHA – HAMP (Home Affordable Modification Program) to make available help for struggling American's homeowners to adjust or modify their existing mortgages to make affordable monthly payments.
Obama Housing Plan is all set to escalate the Housing and Urban Development to heights of progress, thus stabilizing the pillars of its own administration's foundation. The current scenario is well evident of the home owners struggling to save their homes of foreclosures. Obama announced that the administration will devise programs that will assist the homeowners and that too unemployed ones through the two targeted foreclosure prevention programs. The projected changes in the HAMP and Housing Finance Agency programs will bitterly assist unemployed home owners who have been affected by the economic crisis. The program modifications will expand flexibility for mortgage servicers and originators to assist more unemployed homeowners and to help more people who owe more on their mortgage than their home is worth because their local markets saw large declines in home values. These changes will help the Administration meet its goal of stabilizing housing markets by offering a second chance to up to three to four million struggling homeowners through the end of 2012.
The unemployment program and the Obama housing plan together will complement existing Administration efforts to assist struggling homeowners - including the Home Affordable Modification Program (HAMP) and Hardest Hit Fund (HHF) initiative administered by the U.S. Treasury Department. As per the modifications,
- The borrower must be at least three months failure in their payments and have a reasonable likelihood of being able to resume repayment of their mortgage payments and related housing expenses within two years. This will let him fall under the unemployment program.
- The property must be the chief residence of the borrower, and eligible borrowers may not own a second home. This is the conventional rule that was there in the HAMP and is not a part of the Obama housing plan for unemployed home owners.
- The borrower must have suffered at least a 15 percent reduction in income and have been able to afford their mortgage payments prior to the event that triggered the loss income.
To meet these objectives, the Administration has developed a comprehensive approach using state and local housing agency initiatives, tax credits for homebuyers, neighborhood stabilization and community development programs, mortgage modifications and refinancing, and support for Fannie Mae and Freddie Mac. The Administration's efforts for homeowners have focused on giving responsible households an opportunity to remain in their homes when possible while they get back up on their feet, or to relocate to a more sustainable living situation.
A loss in the Housing and Urban Development would be a great setback for the nation's economy. Thus as a part of the supplementary aide in the modification plan, states that are qualified to obtain the support of HAMP plans have all undergone unemployment over the past 12 months. This in turn exhibits their likelihood to a foreclosure and also their failure to be entitled for the loan modification plans that have been devised by the president Obama. Therefore, each state will use the funds for targeted unemployment programs that provide provisional backing to the eligible home owners to make their mortgage payments while they hunt for a re-employment, an additional employment or undertake job training. The modifications in the Housing Finance agency and the Obama housing plan are a real catalyst to the unemployment programs; thus giving distressed home owners a sigh of relief.
Obama administrator have launched 2 chief foreclosure prevention programs know as Emergency Loan Program and Hardest hit fund to help struggling American house owners save their precious homes by stop foreclosures. Visit Refinanceitt.com to know more about it.