HOPE for Homeowners Program

[worried]

Hello...does anyone know about this program. Can you get into this program if you are in a chapter 13 already. I understand from all my research that the lender has to agree to forgive some of the arrears but that the lender would get about 50% of the equity if you sell. Right now my plan calls for almost double payments and I wonder if it would be all worth it. I have to pay 830 for regualr payments and 640 for arrears. I would be so happy to just pay the 830 a month. Also the interest rates are lower and they are talking of cutting the rate again this week. Currently I pay 7.375% and I think the rates are something like 5%. That's already about 200 a month difference. Thanks

[HHM]

If you are already in BK, you do not qualify for any federal program.

Note, almost nobody, in or out of BK, qualifies for the program, the restrictions are too narrow.

Here are the details

http://portal.hud.gov/portal/page?_pageid=73,7601299&_dad=portal&_schema=PORTAL

It is actually a fairly crappy program.

[Flamingo]

I am assuming from your posting you are in a Chapter 13. You would have to discuss this with your attorney as you would need Trustee permission to refinance under that Program. This program is not that popular and not many people have applied for it - the main reason being is that the lender gets a chunk of future equity.

[worried]

My mortgage is USDA and this is a federal program. They will collect 6000.00 already from me because when I first got the loan I qualified for low interest. But when you sell you have to pay back so much. I haven't gotten that subsidy for 4 years now because I have a daughter who is an adult and has income and living at home. That's why I don't qualify now for the low interest now. My interest now is 7.375 but rates keep going down. At what point am I going to be able to refinance to get smaller payments. Pretty soon they'll be down to 4% and wow that's like 300 less a month. Also I've been hearing the new president wants to implement new programs for the mortgage mess. Anyone else hear that too. Also on Dec 24th I'll be 2 months behind on my mortgage but plan to pay one on Dec 30 and then catch up first part of Jan. I hope they don't do anything. Thanks

[worried]

HHM ...I read HUD's article and I could not find where it says you can't refinance to H4H if you are in a chapter 13.

[Overmylimit]

HHM is right I looked into this before I started my Modification, I couldn't qualify. I did however get a Modification thru my lender GMAC; they told me today.

[worried]

Are you in an active chapter 13. I've only been in mine for 9 months but ended up having to buy a lot of fuel oil and got behind on my payments. But I am confident I will catch up end of month. Will they do a modification now since I filed on them and already got behind on my payments. I don't know if my lender is easier to deal with because they are a federal lender. Thanks

[blindsided]

H4H is, as noted, a pretty crappy program with only a limited qualifying demographic. Basically you have to be behind on your mortgage AND at risk of foreclosure, but the bankruptcy gives you an automatic stay, so you are not someone the program was created for.

Congress held hearings on the program in November to see how it was going. The original goal was 400,000 refis over 3 years, with 19,000 applications expected in the first year. But the real numbers were stunningly small: just 111.

http://www.cnbc.com/id/27701737

Make sure you discuss your payment issues with your attorney to look into modified plan payments. What you probably need is something like 12 months of on-time mortgage AND plan payments before they will discuss a modification of your loan.

[Flamingo]

Are you in an active chapter 13. I've only been in mine for 9 months but ended up having to buy a lot of fuel oil and got behind on my payments. But I am confident I will catch up end of month. Will they do a modification now since I filed on them and already got behind on my payments. I don't know if my lender is easier to deal with because they are a federal lender. Thanks

If you are in active Chapter as you state, and you are behind on your mortgage payment, contact your attorney right away. Note - most modifications require you to be at least 2 to 3 months behind on payments. If at any time during your Plan you feel you cannot make a mortgage, Plan or other payment, contact your attorney immediately.

[getmeoutofhere]

This is from the FAQ on the H4H program:
Eligibility questions
My lender has started foreclosure proceedings. Can I still apply for H4H?
Yes, however, time is of the essence.

Is there an income restriction?
No, but you will need to demonstrate that you have sufficient, steady income to make the new H4H mortgage payments.

I recently filed for bankruptcy. Am I still able to apply for H4H?
Yes, borrowers in bankruptcy may participate; however, you will want to consult with the person handling your bankruptcy.

My lender has already foreclosed on my home. Can I still apply for H4H?
It may be possible depending on which stage of the foreclosure process you are in. You should talk to your lender immediately for more detailed information.

I have a first and second mortgage on my home. Can I still apply for H4H?
Yes, however, all your existing lenders must agree to release the liens against your home.

I am current on my mortgage. Can I apply for H4H?
Yes.

[freshstart10]

when i called fha they said people in bk are eligible....the problem is most mortgage companies wont get involved.

[chloe0724]

Yeah,

I tried to see if my mortgage holders would do this. The first did and modifyied my loan from an ARM to a fixed, but the holder of my second said they don't participate.

[Tom_Mi]

I love these things...haven't read this one in particular but they're all the same catch-22:


-You MUST be late on your payments.
-You MUST have good credit.

Since anyone late on their payments does NOT have good credit, the politicians don't have to trouble themselves with actually helping anyone.

[chakra7]

Ok. I read in one of the earlier posts that you need to contact your attorney ASAP when you know you can't afford your BK payments. I did this - contacted my attorney as soon as I knew the payments were becoming too high for me to afford to make due to my loan adjusting. My wages are garnished so the payment comes off the top of which payroll at my former place of employment (I was recently laid off, but have severance for the next three months) would not adjust the garnishment when sent orders by the trustee's office (another issue for which my attorney would not address) SO NOW my case has already gone before the judge for a hearing for review to dismiss if I don't make up missed payments by first full week in Jan. I told my attorney, (A) these payments are too HIGH - the loan adjusted three times since being in BK, and could the payments be modified to reflect that I need income to actually live on? His response was that my payments could not be modified because both mortgages had to be paid as well as arrears, and that despite the interest rates going down, the BK payment would not. He gave me no hope of any sort of modification being able to be done. His next suggestion is that I convert to a Ch.7 for around $700 and let my home go into foreclosure. He advised against a short sale saying I would owe taxes on the forgiven amt. and that may get me denied by the trustee to even convert to a Ch.7. I'm baffled; confused; and feel totally left out in the cold by this attorney who is a former Bk trustee himself. I know there have to be alternatives besides just converting to a 7 and foreclosure for me, esp. in light of my former employment's negligence in garnishing the correct amt. from my pay. Even when I contacted them about this, they just said "oh well, but you knew how much you were supposed to pay; we don't know how the mistake happened." and to this day, they're still only garnishing partial payments.

[getmeoutofhere]

Hope

I spoke to several "approved Hope Lenders" yesterday as this program intrigued me. All said the same thing. Great program, but no one can get in. Apparantly, the banks are not willing to "jump in" yet. The way the program works:
The home is appraised. So in my case, let's say you owe $650K but your home appraises at $375K.
The bank would agree to accept a "guaranteed amount" of 96.5% of the appraised value or $362K. The shortfall, or equity, would be shared between me and the bank each owning 50%. If/When I sell the home, the bank would get 1/2 the equity and I would get the other 1/2. So, in 10 years, if I sould the house for $400K, the bank would get 19K and I would get 19K. Apparantly, there is also a "hidden" cost of 2% that the bank has to pay the governement to "participate" in the program.

The mortgage people that I spoke with said the banks are starting to consider this as an option and they expect some of the "big" lendors to jump on board soon. Apparantly, the "cost" of foreclosure has jumped from 25% to 44% and continues to rise. Anything over 40% is "unacceptable" to the banks.

So, I am going to attempt a loan mod with First Horizon. Yes, I had to be 90 days late for them to even speak to me. I have submitted my new budget and workout info. My thought is this. I owe $510K on the first (second will drop off as unsecured). The house will appraise at about $375K. Based on a 44% cost of forclosure, they would be looking at "netting" $210K if they forclosed. I am willing to stay in the home at the appraised value of $375K which I can afford and I can prove that I can make the payment. So, they need to re-write the loan at 5%, $375K, 30 year fixed. If not, I will walk and they will lose a ton. These types of workouts are becoming more and more popular with the number of defaults, etc. I will keep you all posted on the outcome.