Comparing Making Home Affordable to Hope For Homeowners (H4H)

The Hope For Homeowners (H4H) and Making Home Affordable are two of the programs that the government has enacted in its attempt to help home owners who are struggling.
What follows is an illustration of each of the programs.

Hope For Homeowners (H4H)

Lender: New Lender. With this program, the home owner is refinanced by a new lender

Value: Current Market Value. A new appraisal sets the value

Mortgage Type: FHA Insured. The new mortgage is insured by FHA

Mortgage Term: 30 years Fixed

Mortgage Rate: Current Market Rates.

Min credit Score?: NO. There is no minimum credit score required.

Mortgage must be current?: NO. The mortgage does not have to be current.

Equity Sharing: YES. The initial equity in the home is shared with FHA 50/50

Can Refinance with a penalty?: YES. If you refinance within 5 years, you lose part of your initial equity

Trial Period?: NO. The mortgage you get is fixed, there is no trial period

Must have a Fannie/Feddie loan?: NO. Any mortgage can be refinanced through H4H

Lender’s Approval?: YES. The current lender must agree to a lesser amount than what is owed if the appraised value is low. (underwater properties)

Can own another residence?: NO. You cannot own another residential property.

What happens to the 2nd?: Paid off as part of the refinance. There will only be one mortgage on the property, so any existing 2nd mortgage is paid off.

When does the H4H program expire?: November 30, 2011

Who do you contact?: Call me at 773-451-5547

Modification

Lender: Same Lender. Your mortgage stays with the same lender.

Value: Historic Value. You carry the existing balance of your mortgage into the modification.

Mortgage Type: Depends on what your lenders offers you.

Mortgage Term: 3 to 5 years

Mortgage Rate: As low as 2% in order to keep your housing payment at 31% of your monthly gross income.

Min credit Score?: Ask lender

Mortgage must be current?: YES

Equity Sharing: NO, there may not even be any equity in the property!

Can Refinance with a penalty?: NO

Trial Period?: YES. Your lender sets the parameters of the trial period

Must have a Fannie/Feddie loan?: YES

Lender’s Approval?: YES

Can own another residence?: YES

What happens to the 2nd?: Stays open, meaning that if you had a second mortgage, you will still need to make those payments.

Who do you contact?: Your Lender.

References: