What is HAMP?

What is the official definition of HAMP?

4 Answers

The Home Affordable Modification Program is designed to help financially struggling homeowners avoid foreclosure by modifying loans to a level that is affordable for borrowers now and sustainable over the long term. The program provides clear and consistent loan modification guidelines that the entire mortgage industry can use.

Borrower eligibility is based on meeting specific criteria including:

  1. borrower is delinquent on their mortgage or faces imminent risk of default

  2. property is occupied as borrower's primary residence

  3. mortgage was originated on or before Jan. 1, 2009 and unpaid principal balance must be no greater than $729,750 for one-unit properties.

After determining a borrower's eligibility, a servicer will take a series of steps to adjust the monthly mortgage payment to 31% of a borrower's total pretax monthly income:

  • First, reduce the interest rate to as low as 2%,

  • Next, if necessary, extend the loan term to 40 years,

  • Finally, if necessary, forbear (defer) a portion of the principal until the loan is paid off and waive interest on the deferred amount. *Note: Servicers may elect to forgive principal under HAMP on a stand alone basis or before any modification step in order to achieve the target monthly mortgage payment. * The Home Affordable Modification Program includes incentives for borrowers, servicers and investors - these incentives are detailed in the documents below.

Home Affordable Modification Program

In February 2009, the Obama Administration introduced a comprehensive Financial Stability Plan to address the key problems at the heart of the current crisis to get our economy back on track. A critical piece of that effort is Making Home Affordable, a plan to stabilize the housing market and help struggling homeowners get relief and avoid foreclosure.

The Obama Administration’s Making Home Affordable Program includes opportunities to modify or refinance your mortgage to make your monthly payments more affordable. It also includes the Home Affordable Foreclosure Alternatives Program for homeowners who are interested in a short sale or deed-in-lieu of foreclosure.

Making Home Affordable website  -  http://makinghomeaffordable.gov/dable website.

It stands for Home Affordable Modification Program.  It is a part of the government initiative to stabilize the housing industry. You can get info at MakingHomeAffordable.gov.

If you can no longer afford to make your monthly loan payments, you may qualify for a loan modification to make your monthly mortgage payment more affordable. Millions of borrowers who are current, but having difficulty making their payments and borrowers who have already missed one or more payments may be eligible.

This site can help you determine if you are eligible, but only the servicer of your loan can tell you if you qualify. To qualify, you will generally need to show that you have adequate income to make the reduced payments on an ongoing basis and that modification is an appropriate option given the characteristics of your mortgage and the value of your home.

It is an acronym for Home Affordable Modification Program.

It is supposed to enable borrowers that meet eligibility requirements to avoid foreclosure by modifying loans to a level that is affordable for borrowers and sustainable for the long-term.

After determining a borrower's eligibility, a servicer will take a series of steps to adjust the monthly mortgage payment to 31% of a borrower's total pretax monthly income:

  • First, reduce the interest rate to as low as 2%,

  • Next, if necessary, extend the loan term to 40 years,

  • Finally, if necessary, forbear (defer) a portion of the principal until the loan is paid off and waive interest on the deferred amount.

Reference here: http://makinghomeaffordable.gov/borrower-faqs.html