In some cases, if a lender has not opted for the government modification program they might has designed their very own in house program to help out their borrowers out. So if you contact your lender and they are not participation in the government mortgage program, then ask them if they have any programs of their own that may help you.
Homeowners that are being turned down for the program are becoming frustrated. They sometimes don’t know where to look for help. They will often call to ACORN or HUD for assistance. ACORN or HUD will give them information to present to their lenders, and they are being referred back to their lender to ask for help. We are talking about the same lenders that turned them down for a loan modification in the 1st place. ACORN tend to be a lot more pro-active, they have been know to go to extreme lengths to assist low income, middle class income, and minority borrowers. Some say they go too far to assist, to the point where some of their members break the law to accommodate borrowers. ACORN members have been known to break back into vacant homes and forcefully move homeowners back into the residence, long after the foreclosure sale, if there were no buyers for the property, and the property is still empty. Municipalities are having a hard times tracking and prosecuting these rouge homeowners that end up moving back into the property they were recently evicted from; Some say this is more of an ethical than a criminal issue in our community. You might have a different take on this. Should homeowners be tossed out into the streets, while their homes sit empty due to non-payment of their mortgage where the home has not been sold to a new buyer.
No one is naive enough to think that this program was going to help all homeowners, or even a large number of homeowners in trouble. That is simply not possible. Government can not just spend and fix all of our problems, and they definitely can not correct our mortgage industry. The market will correct itself on it’s own with enough time. Home prices have to deflate, banks will start lending again, buyers will start their buying trend, and prices will appreciate once more when everyone is back in.
One common question about the government loan modification stimulus program that came out April 4th, 2009 is, has the loan modification stimulus really worked. Many critics and radio talk show hosts don’t believe the stimulus is working. They see many flaws in the Obama Mortgage Stimulus Package. Many experts believe it is just another plow to increase our government’s size and spending. Do you agree? Lets look into the mortgage program a bit.
Obviously some of the requirements to become eligible for the mortgage loan modification program are strict enough to exclude many homeowners from getting any federal help with their mortgages. One of the most obvious is the 31 % housing to income ratio which many critics believe is too high. With this clause, a decent percentage of the population will automatically be excluded right from the start. This program has no middle ground, you are either in or out, very distinct lines are drawn here. For example, lets take an average middle class family making $4,000 gross monthly income, and their net(bring home)income is around $3,000; if their mortgage payment is $1200 or 30% housing-to-income ratio, they would not qualify because they would need to have a mortgage payment of at least $1240 or 31% housing-to-income ratio to qualify. This is just one of the qualifications to get into this program. Mortgage companies are not obligated to participate in this program unless they choose to. Regardless, most lenders will be participation because of the financial reward that they will get for each homeowner that is approved for this plan. If a lender chooses not to participate in the government program usually do to “red tape,” they will not be allowed to receive any of the federal funds, and if they are your lender, you in turn would not be able to participate in the program either; But as I previously mentioned, lenders are looking to participate in this program.
