The Home Affordable Modification Program (HAMP) is a government program that was enacted to help lower homeowners’ mortgage payments. One of the requirements for this program was that the monthly mortgage payment needed to be above 31 percent of the homeowners’ gross income. If this was the case and the institutions that service the homeowners’ loans were participating in the program, these people could apply for a loan modification through HAMP. The result would be that the payment would fall to 31 percent of their pre-tax income.
Has HAMP Expired?
The HAMP program will expire on December 31, 2012. Homeowners who are currently having difficulties paying their mortgages and are in need of a loan modification still have time to apply. Homeowners whose mortgages are currently in distress have the option of hiring a loan modification attorney to assist in procuring a loan modification as well.
Homeowners who are having extreme difficulties making their monthly mortgage payments could benefit from modifying their loans. Should they succeed in doing this, foreclosure proceedings, considered by lenders in the event a homeowner defaults on some or all mortgage payments, could potentially be avoided. Before this occurs, they may be able to renegotiate the terms of their loans so that the payments are lower, and they can more easily afford to pay them every month.
Homeowners are free to negotiate with their lenders for a modification program. Even if a lender does not participate in HAMP, homeowners could still modify their mortgages through the lenders’ own loan modification programs. Although they can do this on their own, homeowners would benefit from the services of a loan modification attorney.
The Benefits of Hiring a Loan Modification Attorney
Homeowners are not always aware of the general practices of their lenders when it comes to modifying a loan. These lenders may not have the homeowners’ best interests in mind when they are involved in negotiations with them. Lawyers can ensure that their clients’ interests are being served before a new contract can be signed. The attorneys can also obtain the best possible deal for their clients because the lenders know that they cannot begin to deceive a knowledgeable lawyer.
Attorneys also have extensive experience in helping homeowners modify their loans for better terms. These lawyers work with the same lenders and may have already obtained a modification for a previous client with the same lenders, so they will be at a great advantage having had experience with these lenders. During modification proceedings, the lawyer may be able to reduce the total amount owed to the lender, lower the interest rate on the loan, lengthen the term of the loan in order to decrease the monthly payments and decrease any late fees and penalties that have been levied against the homeowners.
Hiring an attorney could potentially bring a more favorable conclusion quickly and with the least discomfort to the homeowners. Homeowners may save the money they would need to pay an attorney by negotiating with their lenders themselves, but this would not necessarily help them receive the results they would like to achieve.