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By MarcWites

Having Trouble Refinancing or Modifying Your Mortgage?


Given the current condition of the real estate market, many home owners find themselves with a lot of debt, and some very tough choices.  For those who are struggling to keep up with mortgage payments, both refinancing and loan modification can provide relief, but often such relief may be difficult to secure.  In particular, when the value of one’s home has decreased to less than the amount that is owed on the home, it can be difficult to refinance or obtain a modification.  Fortunately, there are some government programs that can help.

The Home Affordable Refinance Program (“HARP”), an official program of the Departments of the Treasury and Housing and Urban Development, may provide a solution for some homeowners who are not behind on their mortgage and owe more than the current market value of their property.  While the following list does not include all requirements, you may qualify for this program if you meet these criteria:

  • The mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae.
  • The mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009.
  • The mortgage cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009.
  • The current loan-to-value (LTV) ratio must be greater than 80%.
  • The borrower must be current on the mortgage at the time of the refinance, with no late payment in the past six months and no more than one late payment in the past 12 months.

See Home Affordable Refinance Program (HARP) (January 3, 2012) at  (on file with Wites Law Firm).

HARP will end December 31, 2013.  See Id. For a formal determination as to whether you qualify for HARP, you should ask your mortgage servicer.  You can also contact Fannie Mae or Freddie Mac for help in determining if you may be eligible.

By the way, HARP is just one of a number of government programs designed to help homeowners in financial distress.  So if, for example, you do not qualify for HARP because you are not current on your mortgage, you might be eligible for theHome Affordable Modification Program (“HAMP”).  You may be eligible for HAMP if you meet all of the following criteria:

  • You occupy the house as your primary residence.
  • You obtained your mortgage on or before January 1, 2009.
  • You have a mortgage payment that is more than 31 percent of your monthly gross (pre-tax) income.
  • You owe up to $729,750 on your home.
  • You have a financial hardship and are either delinquent or in danger of falling behind.
  • You have sufficient, documented income to support the modified payment.
  • You must not have been convicted within the last 10 years of felony larceny, theft, fraud or forgery, money laundering or tax evasion, in connection with a mortgage or real estate transaction.

See Home Affordable Modification Program (HAMP) (January 3, 2012) at (on file with Wites Law Firm).

If you are not eligible for HARP or HAMP, don’t give up hope.  There are several other programs which may be an option depending upon your specific needs and circumstances.  A more detailed list of these programs and their requirements can be obtained from the Department of the Treasury and the Department of Housing and Urban Development.  For more information, visit www.MakingHomeAffordable.gov.  And of course, it is always a good idea to consult with an attorneywho has experience in dealing with such issues.

Authored by: David Sternberg an associate with Wites Law Firm

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Marc A. Wites

Marc A. Wites is the founding shareholder of Wites & Rogers. He directs the firm’s litigation practice groups for personal injury and wrongful death cases, class actions, property insurance claims, sexual assault, and investment fraud.

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