What is an Obama Loan?

What is an Obama Loan?

The Obama Mortgage. The U.S. government has created several programs aimed at helping borrowers in financial trouble avoid foreclosure, stay in their homes, and make their mortgage payments more affordable. Some use a catch-all term, “Obama mortgage” to describe one or more of these programs.

Can mortgages be forgiven?

There is no mortgage forgiveness. The lender sells the home at auction and uses the money to pay off your mortgage. If he comes up short, he forgives the outstanding mortgage balance. If you want your debt forgiven, you’ll need your lender to agree to a nonjudicial foreclosure.

What is HAMP mortgage program?

The largest program within MHA is the Home Affordable Modification Program (HAMP). HAMP’s goal is to offer homeowners who are at risk of foreclosure reduced monthly mortgage payments that are affordable and sustainable over the long-term. An ability to make their monthly mortgage payments after a modification.

Will the government payoff my mortgage?

Keep Your Home California offers a mortgage-assistance program. Specifically called Unemployment Mortgage Assistance, this grant gives a homeowner up to $3,000 per month for a maximum of 18 months to pay the mortgage. Participants must be unemployed and collecting state unemployment benefits.

What is it called when a loan is forgiven?

A forgivable loan, also called a soft second, is a form of loan in which its entirety, or a portion of it, can be forgiven or deferred for a period of time by the lender when certain conditions are met.

What is Flex modification program?

The Flex Modification program (FMP) is a conventional loan modification program designed to help homeowners who are experiencing long-term or permanent financial hardship. If you qualify, you might be able to have your loan term extended to 40 years and your principal-and-interest payment reduced by up to 20 percent.

Who qualifies for HAMP?

The program’s requirements include:

• Demonstrating your ability to pay the mortgage and not go back into default.
• Making at least 12 monthly payments since your mortgage closing.
• Not having any loan modifications in the past three years.
• Not having more than three loan modifications since your mortgage closing.

Is there a homeowner stimulus?

Related: Homeowners can claim up to $30,000 in stimulus relief for their mortgages, here’s how. This includes mortgage payments, utility bills, and homeowner’s insurance. The cash is federal funding but it’s being given to the states to distribute it.

Can I get money from the government to buy a house?

Local grants and loans to buy a house But the majority of them come from state and area Housing Finance Agencies (HFAs). These agencies receive federal grants each year to help homebuyers with down payments and closing costs. They might offer aid in the form of a: Forgivable loan.

What is a 5 year forgivable loan?

With a forgivable second mortgage program, some or all of the original down payment assistance amount is forgiven. For example, 20 percent of the loan might be forgiven each year for five years, so after five years the entire original down payment loan is forgiven and the second lien removed.

What is a 10 year forgivable loan?

A forgivable loan, also called a soft second, is a form of loan in which its entirety, or a portion of it, can be forgiven or deferred for a period of time by the lender when certain conditions are met. However, if the conditions are not met the loan has to be repaid usually with interest.

Does Flex modification hurt your credit?

Technically, a loan modification should not have any negative impact on your credit score. That’s because you and the lender have agreed to new terms for paying off your loan, so if you continue to meet those terms, there shouldn’t be anything negative to report.