Ask Bill your personal finance question

Information on The Hope for Homeowners Program

Do you know much about the new Hope for Homeowners program?

Hello Bill - do you know much about the new Hope for Homeowners program? We read a lot about it earlier this month and thought we might qualify. We haven't contacted our lender about it yet, but any general advice or experiences you can share about the program would be helpful. Thanks

Read full question
Bill's Answer
4.3
/5.0
(4 Votes)

Bills.com | Find Learn Save

Hope for Homeowners (H4H) - the program primarily calls for voluntary principal reduction to 90% of the current home value, from lenders and servicers and from what we’ve learned (industry news, contacts at large national lenders, secondary market contacts, loan modification firms) this has not been happening. Unless it’s been forced on them (as in the case of Indy Mac, Countrywide and recently Chase) lenders are not ready to give principal reductions. There is a section in the H4H program that does call for mandatory principal reductions by lenders, on the condition that the homeowner makes the case that the lender and their investors will recover more from a reduction in principal to 90% of the home’s current appraised value, than from a foreclosure. It is up to the homeowner to make this case. The FHA (who governs the H4H program) just announced that in the first two weeks after the launch of H4H on October 1st, there were 42 applications from lenders. That number, along with the overwhelming anecdotal market evidence, clearly shows that there is no meaningful activity on reductions. Larger lenders experienced large call volume in the week immediately following the announcement of H4H, but apparently those callers have not been helped.

Other Options - in addition to H4H, many homeowners may be eligible for a standard loan modification, where they receive a fixed rate payment plan for the next five years (or a variation of this). This can be done through a refinance (FHA Secure program) or more commonly, by contacting the lender and proving that the current payment is unmanageable. This adjustment of rates and terms seems to be picking up quite a bit of steam, and in the wake of the recent Indy Mac and Countrywide settlements, an increasing number of homeowners are benefiting from this development. At this point, we feel that contacting your lender and making your case for reduced interest rate or an extended loan term is the most effective option. Other options include a refinance, deed-in-lieu or sale of the house.

We will continue to monitor this developing situation. Keep an eye on the Bills.com home page as we will soon be launching the Bills.com Borrower Relief Center, which will contain tips, advice, news updates and links to other relevant sites.

Thanks for your question.

Best,

Bill

www.bills.com/

Get Mortgage Rates!
4.3
/5.0
(4 Votes)

People also like to Read

Daniel Cohen

FHA Loans | FHA Loans have huge benefits, including VERY low down payments and low credit limits. Get FREE info on FHA loans... Read more >>

Betsalel Cohen

Mortgage Basics - Down-payment, Equity, and LTV | Learn about mortgage terms relating to your property's value and how it aff... Read more >>

Betsalel Cohen

Whether you are refinancing or buying a home you will ask yourself if you can afford the mortgage. Learn to prepare and evalu... Read more >>

Betsalel Cohen

Qualify for a Mortgage | You can get qualified for a mortgage and the best rates by preparing yourself. Make sure that your c... Read more >>

Betsalel Cohen

Obama Passes HARP, but borrowers are looking for HARP 3.0 Mortgage Refinance programs. When a HARP 3 update is announced, you... Read more >>

Mark Cappel

Applying for a mortgage with bad credit and a spouse isn't as difficult as you may think. Learn the what lenders look for whe... Read more >>

Betsalel Cohen

PMI | If you are looking to buy a house and take a mortgage loan with a low down payment then PMI can...... Read more >>

Brad Stroh

Refinance My Home? If you are asking 'Should I refinance my mortgage?' or 'Is refinancing my home a good?', then check out ... Read more >>

6 Comments

Recent Best
1500 characters remaining
  • BA
    Jan, 2009
    Bill
    You need to ask Countrywide if they participate in the program. For program details and eligibility, see here: http://portal.hud.gov/portal/page?_pageid=73,7601299&_dad=portal&_schema=PORTAL
    0 Votes

  • IJ
    Jan, 2009
    Iona
    I'm about to re-fi with Countrywide for a cost of about 2,500. I heard from my sister that I can get a rate reduction through the HOPE program for free. This, especially since I lost my job 1-1/2 yrs ago and my husband has had several strokes and heart attacks. I fell behind 5 months in my mortgage payments in o7 but with help from family caught up through a re-payment plan and became current in Aug of 08. Countrywide has not mentioned anything about a free reduction in my rate. Can I really get free help with this? THANK YOU!!!!!!!!
    0 Votes

  • BA
    Jan, 2009
    Bill
    Bummer. It is unfortunate that Hope for Homeowners has not done a perfect job for everyone, and we do hear quite a few complaints about lack of service and lack of direction from them. Good luck and hang in there.
    0 Votes

  • 35x35
    Jan, 2009
    Tom
    I called the Hope Program. A truly bogus program. After long waits, they referred me to the web site, which then referred me to one of the workout companies just seeking business. This company said they can't do much on helping with delinquent loans, but would be happy to work iwth my credit card company - the easy money for them - and that I shoulod budget better.
    0 Votes

  • 35x35
    Jan, 2009
    Tim
    Yes, the Bush administration is not doing anything to help people, other than the B3 - Bank Buddy Bailout, by Paulson, the former bank exec, soon to be one again, in which he bailed out his bank buddies for selling toxic loans, but not requiring that they work with people in any meaningful way, and they don't. Meanwhile, Bush, who like his Dad let the country's economy drift off into oblivion while he sat having fun and saying "What problems?", each of who I voted for their first time running, being the pawns they were and catering to those who put them there.
    1 Votes

loading...