Many home owners are currently finding it difficult or impossible to keep up with their mortgage payments. Interest rates on ARM (adjustable rate mortgages) have risen tremendously, causing many to default on their mortgage and finding they must lose their home due to foreclosure. President Obama has approved a loan modification plan that is aimed directly at those who need help in order to keep their homes.
Why would your mortgage lender want to participate in this plan? Because they find it is in their best interest to keep you in your home. They are not in the real estate business, nor do they wish to become realtors. They merely want to show a profit while helping people realize the American dream of being home owners. When those owners of the house can no longer afford to make their monthly mortgage payments, they default and everyone loses. This is where the new loan modification plan is proving to be helpful to all concerned.
The past few years have seen not only a collapse of the housing market in this country, but many jobs lost by home owners who had up until that point, been able to make their monthly payments. Home prices fell substantially and at the same time, home owners found they could not sell their homes for what they owed on them. This is a recipe for disaster in the housing industry and for many Americans in particular.
The loan modification plan, as laid out by the present administration, has been received with open arms by both borrowers and lenders who wish nothing more than to keep the tradition of home ownership intact.
Home owners who find themselves in distress and can no longer make their monthly payments need to contact their lender and request help through a loan modification plan. Home owners who have been able to keep their payments current but feel their financial situation will change soon (example: retirement or illness) and may have lost a significant amount of equity in their home due to the housing crisis may also qualify for assistance through the government assistance program known as the loan modification program.