Ask Kim
Do You Qualify for Housing Help?
You may be eligible for the government's new programs that provide refinancing and loan modification.
By Kimberly Lankford, Contributing Editor, Kiplinger's Personal Finance
March 30, 2009
How can I find out if I will qualify for help with my mortgage under the Obama administration's plan?
The administration's housing plan provides two types of assistance that are designed to help make mortgages more affordable for up to nine million homeowners: refinancing and loan modification.
Special refinancing program. Many homeowners with more than 20% equity in their home can refinance their mortgage at today's low rates and decrease their monthly payment by hundreds of dollars. But people whose home values have dropped significantly often have a tough time finding a lender that will refinance their mortgage, especially if they owe more than 80% of their home's current value. This special program will help those people refinance into cheaper loans. To qualify, your loan must be owned or guaranteed by Fannie Mae or Freddie Mac, and you must not have missed any loan payments in the past 12 months. The deadline for refinancing under this program is in June 2010.
Your mortgage may be owned or guaranteed by Fannie Mae or Freddie Mac even if you send your monthly payments to a different mortgage company (the mortgage servicer). Ask the servicer if Fannie or Freddie owns your loan, or you can look up your loan in the Freddie and Fannie databases at MakingHomeAffordable.gov.
Loan- modification program. This program is designed to help people who are struggling to make mortgage payments. The government will provide incentives for lenders to lower borrowers' monthly mortgage payments to 31% of their gross monthly income, either by lowering the interest rate to as little as 2% or by extending the terms of the loan up to 40 years. Lenders can also lower the amount of principal owed. To qualify, the loan must have originated on or before January 1, 2009, the principal balance cannot exceed $729,750, and the home must be a primary residence. Borrowers also have to document income and sign an affidavit of financial hardship. The modification must take place by December 31, 2012.
To learn more about both programs, go to MakingHomeAffordable.gov, which includes a tool to help you determine whether you are eligible for either kind of assistance..
For more information about help for housing troubles, see Fighting a Foreclosure.
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Reader Comments (6)
Posted by: bianca at 11/14/2009 04:59:50 PM
i was wanting to know what and how i can get help for myself and my daughter to have a home of our own, we are indeed on foodstamps, medicaid. I REALLY NEED HELP I HAVE NO CLUE WHERE TO START I NEED HELP I HAVE BEEN STAYING AT MY MOTHERS HOME AND IT IS NOT GOOD FOR HER HELTH TO HAVE US THERE I MEAN SHE LOVES US BUT SHE NEEDS TO BE ON HER OWN, BUT I WANT TO KNOW WHAT I CAN DO TO GET HELP TO EITHER BUY A HOME OR SOMETHING I HAVE N0 MONEY...I JUST NEED A PLACE FOR MYSELF AND MY 2 YEAR OLD CHILD TO LIVE, PLEASE HELP ME FIND THE RIGHT WAY TO GO ABOUT IT!!! THANK YOU AND MAY GOD BLESS YOU ALL THAT HELP ME:)...
Posted by: rainy at 12/03/2009 02:36:30 PM
I am living in a walk up building top floor with an disability that enable me to walk the stair anymore. I have section 8 and have permission to move. Now i have a problem with not having the security and moving expensive and because of my credit and low income i can't find an apartment that suitable for my disability. Is there any help you can advise me with? i would be very much appreciated, thanks
Posted by: Cora Bracken at 01/16/2010 03:05:47 PM
I need help to either refinance my home or a 2nd mortage. I work for myself and make enough to live on. But I am goning to lose my home if I do not find a way to refinance it or 2nd mortage. Can anyone help me?
Posted by: Kristin at 02/18/2010 02:58:34 PM
I am a single mother of 2. I was on temporary disability due to surgery, and when I tried to return to work, I was told there was no job for me. I am TRYING to get unemployment, but am in limbo. I was on a temporary housing assistance program, but it is being terminated as of April 1. We live in a subsidized apartment complex, but after April 1, I am going to have to pay over $1100 a month for a three bedroom apartment in an area that is becoming less safe every day. I very rarely get child support, and was told that I made 15 dollars a week too much when I was working (back in September), so I do not qualify for any type of food stamps or other help. All I want is for my kids and I to live in a safe affordable enviornment. I have been on the list for section 8 for 5 years, but was told "other people need it more", because I at least had a job. Well, now I don't, and I don't know what's going to happen to us come April. I have tried to appeal to senators, freeholders, housing authorities, and have even sent NUMEROUS e-mails to President Obama. State agencies just tell me "good luck", and I didn't even get ANY type of response from Obama. Can someone PLEASE help us?....
Posted by: Heather at 03/26/2010 12:18:57 PM
how can I get housing help? Me and my 3 chcildren are living with a friend day to day and I am in desperate need...
Posted by: betsy at 06/14/2010 10:28:50 PM
in 2001 i became disabled work comp exposure and my wonderful husband took care of me. then my son blew his acl in his knee which started our descent into hell. i... took care of him only to find out my father in law was ill with diabities and just like my mom it was diabeties it was pancreatic cancer. after going with him to doctors we lost him. 1 week after loosing him we found out my/our rock my husband sinc 15 yrs had cml lukimia kaiser dropped him like a rock. we lost him one year later 2 days. still fighting my own battles with health the wounds of the souls slowly start to mend financilly...my son and i have lost the past three years of our lives. now we have to worry if we will be battling for life in the street...so all of you please pray for my kids but mostly my son becouse ase he lost his other knee...my prayers are with all of you who are fighting your own battles luv betsy...