HAMP Principal Reduction Alternative Offers Improve Bringing Help To Homeowners Facing An Underwater Mortgage Payment

There have been positive reports in recent months that certain cities and major metropolitan areas have seen increases in home values, which is positive news for those homeowners who have been struggling with negative equity over the past months or even a year or more. Yet, some commentators feel that these positive numbers that we have seen are not necessarily being seen across the nation, despite the fact that some hard-hit cities did report home price increases, nor are we to expect that home prices are going to continue to rise in the coming months.

It’s because of this uncertainty and in some cases the severity of a homeowner’s negative equity situation that homeowners are turning to principal reduction assistance programs, specifically the Principal Reduction Alternative initiative available as an extension plan from HAMP. Recent data from the Treasury Department has shown that the total number of Principal Reduction Alternative trial modifications that have been started increased between June and July from 26,258 to 29,406, with the current number of active modifications standing at 18,404.

Also, homeowners who received a principal reduction modification saw an increase in the number of permanent modifications that are currently active with the PRA program in place as recent reports here in September show that these permanent modifications jumped from 6,941 to 9,221 between June and July. What this means for some homeowners is that if negative equity is still a problem, certain programs are not only still available in September but these past reports are still showing success that is being seen for homeowners seeking out payment assistance and a principal reduction in instances where the equity on their home has fallen.

Sadly, some officials feel that home value prices will continue to remain low throughout 2011, and even when improvements are thought to potentially begin, it will take a substantial amount of time before some homeowners see any improvement due to the severity of their negative equity problem. While the issues that underwater homeowners face may differ, as there are some who are looking for foreclosure prevention aid and affordability but others are simply wanting some form of relief in terms of their mortgage principal being much lower than what they currently owe, there are some options that may be available outside of the Principal Reduction Program for homeowners in certain states.

When all is said and done though, some homeowners may face a problem in the form of their mortgage servicer as there are some banks willing to cut homeowners a mortgage principal reduction deal, offer assistance through federal and state principal reduction programs, or were homeowners who are current on their home loan and continue making payments there may be aid through in-house principal forgiveness programs, but this will be a different case from one servicer to another. Yet, homeowners should know that there are still options and resources available here in September if negative equity and even affordability issues remain a problem on their property and making contact with a servicer or housing counselor may help homeowners better explore these options.