Mortgage Assistance and Loan Modification
Q: What is mortgage forbearance, and how does it work?
A: Mortgage forbearance temporarily pauses your monthly mortgage payments during financial hardship. This arrangement provides relief while you regain financial stability, but it's not debt forgiveness. The repayment of missed payments can be structured in various ways post-forbearance.
Q: Can I modify my loan to make my payments more affordable?
A: Yes, loan modification adjusts the terms of your mortgage to make payments more manageable. It can involve reducing the interest rate, extending the loan term, or other measures, especially for those who have experienced a permanent change in financial circumstances.
Q: What is a partial claim silent second?
A: A partial claim silent second is a secondary loan, often used in FHA mortgage modifications, to cover arrears or other specific costs. This loan typically doesn't require payments until the first mortgage is paid off, the home is sold, or refinanced. It helps homeowners catch up on overdue payments without immediate financial burden.
Q: What are in-house modifications?
A: In-house modifications are mortgage adjustments provided directly by lenders, not through government programs. These modifications vary between lenders but generally involve changes to the mortgage terms to make them more manageable for the borrower.
Q: What are zombie loans?
A: Zombie loans refer to mortgages where the foreclosure process has started but not been completed, and the homeowner has abandoned the property. Homeowners are often still legally responsible for these properties, leading to complex legal and financial issues.
Q: What is the Flex Mod program?
A: Flex Modification, offered by Fannie Mae and Freddie Mac, is designed to help borrowers who are at least 60 days delinquent. It aims to reduce monthly payments by about 20% through loan term extension, interest rate reduction, and possible principal forgiveness.
Q: How long does it take to find out if I am eligible for mortgage assistance?
A: The time frame to determine eligibility can vary, but you will typically receive a decision within 30 calendar days of submitting a completed application.
Q: What are the eligibility criteria for the Streamlined Modification Initiative?
A: This initiative, for loans owned or guaranteed by Fannie Mae or Freddie Mac, is for homeowners who are 90 days to 24 months delinquent. The initiative includes easy modification terms without requiring financial or hardship documentation.
Q: Can I reapply for mortgage relief if I have already received assistance?
A: Yes, in some programs, like the California Mortgage Relief Program, you can reapply for assistance and receive up to a certain maximum amount, provided you meet all eligibility criteria at the time of the new application.