How to Qualify for a Government Mortgage Bailout
If you're struggling to make your mortgage payments each month, you can find help. The federal government in 2009 launched its Home Affordable Modification Program. Known as the "government mortgage bailout," this program encourages lenders and banks to rework the mortgage loans of homeowners who are having difficulty cobbling together a mortgage payment each month. The goal is for lenders to somehow lower the monthly payments that their clients must provide. To qualify for a government loan bailout, though, you'll have to meet certain requirements.
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Instructions
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Call your mortgage lender as soon as you begin having financial difficulties that might impact your ability to pay your home loan on time each month. Explain to your lender what financial hardship you are facing -- anything from a reduction in working hours to a serious illness that has kept you from earning an income -- and request a government loan modification.
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Gather and make copies of any financial documents that your lender requests. Your lender might want copies of your most recent bank savings and checking account statements, last two paychecks and most recent federal income tax returns. Your lender will use these documents to verify your gross monthly income to determine if you qualify for a loan bailout. Mail, fax or email these documents to your lender.
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Write a financial hardship letter. This letter should explain in detail why you can no longer afford to pay your mortgage loan each month. If you've suffered an injury that has kept you from earning your usual monthly income, write about this. If your boss has cut your working hours, put this in the letter. Fax, email or mail this letter to your lender, who will consider it when deciding whether you qualify for a loan modification.
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Give your approval to any loan modification that your lender proposes. Your lender may lower your interest rate, lowering your monthly payment at the same time. Your bank may rework the terms of your loan, transforming your mortgage from a 15-year fixed-rate loan to a 30-year fixed-rate version, again lowering your monthly payment. Make sure, though, that you can afford your new payment that results from any changes.
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Sign any paperwork that makes your loan modification permanent.
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