Homeowners struggling in their mortgage due to unemployment or having an underwater mortgage may find help in the expanded plans within the home loan modification program. Mortgage principal reductions and unemployment forbearance are two new options that may provide assistance to homeowners that are having a difficult with their home loan payment.
Unemployed homeowners may qualify for mortgage forbearance for three to six months, in the hopes that they can find employment and continue making their mortgage payment after the forbearance period. Also, unemployed homeowners may be able to use the forbearance time to discuss the selling of their home with their lender.
Underwater mortgages, on the other hand, may be getting principal reductions as homeowners walk away from their mortgage after seeing their home’s value drop. Homeowners that view their home as an investment often are frustrated when they owe much more on their home than it’s worth, so by continuing to make mortgage payments those in the principal reduction plan will see a decrease in their mortgage principal over time.
While not all homeowners are going to be able to qualify for these programs and as we have seen with home loan modifications, there are sure to be troubles, homeowners shouldn’t let this stop them from seeking out mortgage assistance in one of these expanded programs.