Are You Eligible for a Loan Modification Under HAMP?

April 9, 2010 - The Home Affordable Modification Program (HAMP) is designed to help distressed homeowners avoid foreclosure by modifying their home loans. If you are facing a foreclosure, how do you know if you are eligible for HAMP? Here's what you need to know about HAMP eligibility, directly from MakingHomeAffordable.gov.

• The home in question must be your principal residence. This is designed to ensure that people don't take advantage of the HAMP program to obtain a loan modification on a vacation home or second residence.
• The value of your mortgage must be less than $729,750.
• You must have trouble paying your monthly mortgage payments. Most homeowners will have to provide proof documenting that there has been a change in their circumstances, either due to rising monthly payments from an adjustable-rate mortgage or a job loss. Those who have recently had an increase in medical bills may also qualify.
• The closing date on your mortgage must be before January 1, 2009.
• Your monthly payment must be more than 31% of your monthly income. This is another way that the HAMP program assures that funding goes to those who really need it, and not those just wishing to save some money on their mortgage payments.