It’s been reported that mortgage servicers who have been participating in the Making Home Affordable Program have, as of August 1, agreed to provide assistance for homeowners who are unemployed and need a more affordable home loan payment. The Home Affordable Unemployment Program is set to offer homeowners who are without a job the ability to either reduce their monthly mortgage payment or take part in a forbearance period in which their payments would obviously be suspended.
The Making Home Affordable website reports that a minimum forbearance period of three months may be offered, but it is at the discretion of the mortgage servicer as to how much longer a forbearance will last past the minimum requirement. This program is hoped to help homeowners who may have been denied a modification and aid those who are simply relying on unemployment benefits as their only income.
News on the Making Home Affordable’s Unemployment Program states that unemployment benefits will not qualify as income for the modification program, which could be troublesome or helpful for some homeowners, depending on the situation. Many of these unemployed men and women who have been attempting to save their home are having trouble with traditional modifications and have to scrape by on the meager earnings that come from these unemployment benefits. As a result, many have been unable to benefit from the modification program and are in need of a greater reduction in their monthly home loan payment requirement.
The Home Affordable Unemployment Program states that a homeowner’s monthly mortgage payment must be reduced to no more than 31% of their income, which may afford many homeowners the ability to avoid losing their home. Also, homeowners who are being considered for the Unemployment Program may benefit since foreclosure proceedings or a sale of their home will not be allowed during the evaluation process for this unemployment mortgage assistance plan.
Unemployment, obviously, remains a major problem as job growth does not meet the demands of the number of men and women who are unemployed and seeking a job opportunity. However, despite the fact that the job market is slow to add new employment opportunities, it’s hope that this new Home Affordable Unemployment Program will offer these unemployed men and women the opportunity to keep their home while they continue to look for work or wait for income opportunities arise.