Download Adobe PDF ReaderHelp for the Unemployed
Beginning July 1, 2010, mortgage servicers participating in the Making Home Affordable Program will offer extra help for homeowners struggling to make their monthly mortgage payments because of unemployment. Generally, the Unemployment Program will offer homeowners a forbearance period to temporarily reduce or suspend their monthly mortgage payments while they seek re-employment.
Basics
- Typical forbearance period is 3 months (may be extended depending on the investor and regulator guidelines).
- If borrower becomes employed, the forbearance period ends.
- During the forbearance period, a homeowner’s monthly mortgage payment must be reduced to no more than 31 percent (or less) of their gross monthly income.
- No foreclosure proceedings is permitted while a homeowner is being evaluated for the Unemployment Program or in the forbearance period.
To Qualify
- Mortgage must have been originated on or before January 1, 2009.
- Unpaid principal balance must be equal to or less than $729,750 for a one-unit property.
- The property must be the homeowner’s principal residence.
- The mortgage has NOT been previously modified through a Home Affordable Modification.
- The homeowner was INELIGIBLE for a Home Affordable Modification.
- The homeowner is either behind on payments (NOT more than three consecutive months) or it is reasonable foreseeable that the homeowner will fall behind.
- The total monthly mortgage payment is greater than 31 percent of the homeowner’s gross monthly income. If the payment is less, it is up to the servicer’s discretion if they will offer the program to the homeowner.
- The homeowner can prove that at the start of the forbearance period they are unemployed.
Information on this program is from Making Home Affordable Program; http://makinghomeaffordable.gov