The Home Stimulus Plan - Turning the Situation Around
The economy is in a downhill slide; economists' predictions vary, but they all agree the situation is not ideal. In a domino effect, the housing market has also fallen. Home sales have almost halted, foreclosures are at an all-time high, and home values have dropped quite significantly. President Obama and Congress have enacted a Home Stimulus Plan to attempt to turn the situation around in the housing market. This plan will also help millions of homeowners who are in mortgage trouble turn their situation around, too.
This federal program will help homeowners by giving the bank a large financial incentive to rewrite their mortgages so they will have lower house payments. This should help them stay in their home. This can be done through different methods that the banks have been given as alternatives to lower payments. They can lower interest rates, lengthen loan terms, forgive late fees, and even reduce the actual principal of the loan. The goal is to get you a house payment, including taxes, insurance, and homeowner dues, that is less than 31% of your gross monthly income.
Only certain lenders are approved to participate in this program, and only loans backed by Fannie Mae or Freddie Mac will be able to be modified. There are, too, qualifications concerning your financial situation, but you may qualify. Part of the qualifying criteria is proving you have had a financial hardship. This is something that has happened to you that you couldn't control and it caused your income to significantly drop or your expenses to go up. This resulted in your house payment being more than 31% of your gross monthly income, and you can't continue to sustain it.
It is worth checking into the application guidelines for the Home Stimulus Plan; it could save your home! And, it would definitely turn your financial situation around.
