Homeowners have been having mortgage troubles that are related to underwater mortgages and unemployment, so the Obama Administration has extended the home loan modification programs to provide assistance for homeowners in these situations. Homeowners with an underwater mortgage may be able to obtain a principal reduction and homeowners that are unemployed may be able to get forbearance on their mortgage payments.
Unemployment continues to be a problem and many homeowners are struggling to keep their home as a result. Forbearance programs are hoped to either give homeowners a break from their mortgage payment in the hopes they can find employment or allow them to discuss selling their home.
Underwater mortgage principal reductions may offer homeowners the opportunity to lower their mortgage principal to an amount that is more in line with the current market value on their home. Many homeowners have seen the value of their home drop substantially below what they still owe on their home and have become frustrated as a result.
While not all lenders are offering these programs, homeowners that are distressed due to unemployment or an underwater mortgage have been advised to seek out options with their lender for any available assistance. Homeowners should be sure to research what either a principal reduction or forbearance would entail for them and make certain it is in their best interest to proceed.