The US Treasury today released details on the “Making Home Affordable” program announced by President Obama here in Phoenix on Feb 18.
Dubbed the “Mortgage Rescue”, “Homeowner Affordability and Stability Plan", “Homeowner Bailout” and various other names in the press, the official program name is now the “Making Home Affordable” (MHA)program.
Details are available at a new site, FinancialStability.gov. While the site says it is “coming soon” there is already a great deal of information available there.
The Home Affordable Refinance program will “be available to 4 to 5 million homeowners who have a solid payment history on an existing mortgage owned by Fannie Mae or Freddie Mac. Normally, these borrowers would be unable to refinance because their homes have lost value, pushing their current loan-to-value ratios above 80%. Under the Home Affordable Refinance program, many of them will now be eligible to refinance their loan to take advantage of today’s lower mortgage rates or to refinance an adjustable-rate mortgage into a more stable mortgage, such as a 30-year fixed rate loan.” (source: Department of Treasury MHA Summary of Guidelines)
The Home Affordable Modification program will “help up to 3 to 4 million at-risk homeowners avoid foreclosure by reducing monthly mortgage payments. Working with the banking and credit union regulators, the FHA, the VA, the USDA and the Federal Housing Finance Agency, the Treasury Department today announced program guidelines that are expected to become standard industry practice in pursuing affordable and sustainable mortgage modifications. This program will work in tandem with an expanded and improved Hope for Homeowners program.” (source: Department of Treasury MHA Summary of Guidelines)
Here are 38 Frequently Asked Questions (FAQs) on both the refinance program and the loan modification program (PDF file from FinancialStability.gov).
Here is an updated detailed program description on the Making Home Affordable Program from the US Treasury (PDF file).
There is also a page available that will guide you through some questions and actions you need to take to see if you are eligible for either of these programs. One of the primary factors in determining if you are eligible is whether you have a Fannie Mae or Freddie Mac mortgage. Your mortgage service or lender (where you make your payments) should be able to answer this question. Also, both Fannie and Freddie have set up web pages where you can enter some info and they will let you know (as of this writing, the Freddie Mac page
is not functioning (Update: Link corrected. FinancialStability.gov had it wrong. Thanks Carl!). The Fannie Mae page is functional).
I’ll have more once I’ve had some time to digest and reflect on this information.