Paradigm Law, P.L.C.

Programs Available

 

Paradigm Law is not a government agency, or affiliated with any government agency or program.  The information below is provided only for informational purposes and is subject to change at any time.

 

GOVERNMENT PROGRAMS

The Federal Government has made several programs available to homeowners, and has required lenders to participate in other programs under settlements.  Below are some of the programs available.

 

Making Home Affordable Modification (HAMP)

HAMP is designed specifically to help homeowners impacted by financial hardship. With HAMP, your loan is modified to make your monthly mortgage payment no more than 31% of your gross (pre-tax) monthly income. If eligible, the modification permanently changes the original terms of your mortgage. A HAMP modification may be an option if: You are ineligible to refinance, you are facing a long-term hardship, you are behind on your mortgage payments or likely to fall behind soon, your loan was originated on or before January 1, 2009 (i.e., the date you closed your loan)Your loan is owned by Fannie Mae or Freddie Mac –or is serviced by a participating mortgage company.

 

There are two HAMP programs - HAMP Tier 1 and HAMP Tier 2.  Tier 2 programs are offered to those who do not meet all of the requirements of Tier 1 Programs.

 

Home Affordable Foreclosure Alternatives (HAFA) Program

If you can't afford your mortgage payment and it's time for you to transition to more affordable housing, the Home Affordable Foreclosure AlternativesSM (HAFA) program is designed for you. HAFA provides two options for transitioning out of your mortgage: a short sale or a Deed-in-Lieu (DIL) of foreclosure. In a short sale, the mortgage company lets you sell your house for an amount that falls "short" of the amount you still owe. In a DIL, the mortgage company lets you give the title back, transferring ownership back to them. In either case, HAFA offers benefits that make the transition as favorable as possible: You can get free advice from HUD-approved housing counselors and licensed real estate professionals.Unlike conventional short sales, a HAFA short sale completely releases you from your mortgage debt after selling the property. This means you will no longer be responsible for the amount that falls "short" of the amount you still owe. The deficiency is guaranteed to be waived by the servicer.In a HAFA short sale, your mortgage company works with you to determine an acceptable sale price.HAFA has a less negative effect on your credit score than foreclosure or conventional short sales.When you close, HAFA may provide $3,000 in relocation assistance.

 

You may be eligible for HAFA if you meet all of the following criteria: You have a documented financial hardship. You have not purchased a new house within the last 12 months. Your first mortgage is less than $729,750. You obtained your mortgage on or before January 1, 2009. You must not have been convicted within the last 10 years of felony larceny, theft, fraud, forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction. *Eligibility criteria are for guidance only. Contact your mortgage servicer to see if you qualify for HAFA.

 

Home Affordable Refinance Program

The Home Affordable Refinance Program 2.0 (HARP 2.0) is designed to assist homeowners in refinancing their mortgages – even if they owe more than the home’s current value.  If you are current on your mortgage, with or without equity, then you may be eligible for this program. The HARP program allows you take advantage of current market rates even if you are “underwater”.

 

In an effort to help more homeowners, the HARP 2.0 Program was released.  To reach more U.S. homeowners, Fannie Mae and Freddie Mac have changed their respective Harp 2.0 mortgage guidelines. HARP 2.0 requirements allow Fannie Mae and Freddie Mac to no longer require verfication of income from at least one HARP 2.0 borrower. HARP 2.0 applicants can provide proof that at least 12 months of mortgage payments exist in reserve for the subject property. This includes the sum of principal + interest payments, monthly real estate tax payments, home owners insurances payments, and any requisite association or community dues. HARP 2.0 also has fewer documentation requirements. For example, HARP 2.0 guidelines no longer require verfication of large desposits that appear on applicant's bank or other asset statements. The HARP 2.0 guidelines are newer, simpler, and designed to approve more loans so if you were turned down for the HARP program in the past, apply again as you may now meet the new requirements.

 

National Mortgage Settlement Modifications

The National Mortgage Settlement (NMS) was made available to homeowners through agreements between the 50 states' attorneys general and the following banks:  JPMorgan Chase, CitiMortgage, GMAC/Ally, Bank of America, and Wells Fargo.  Modifications under the National Mortgage Settlement expands eligibility for homeowners in circumstances where another government program may not be available. 

 

IN-HOUSE PROGRAMS

Lenders sometimes offer in-house programs to those who may not qualify for government programs. Below are descriptions of some programs lenders may offer.

 

In-House Loan Modification

Some lenders offer in-house loan modifications, which change the terms of the loan.  They could be offered in the following forms:

-Changing the mortgage product type—e.g. making an adjustable rate mortgage (ARM) a fixed-rate loan

-Reducing the interest rate

-Reducing the principal amount owed

-Reducing the monthly payment

-Extending the maturity date of the note, which lowers payments

-Increasing the unpaid principal balance (UPB) by capitalizing the delinquent amount

 

Deed-in-lieu of Foreclosure

The lender permits the homeowner to deed the property to the lender/servicer to avoid foreclosure generally in exchange for the complete cancellation of the mortgage debt.

 

Short Sale

The lender agrees to let the homeowner sell the property prior to foreclosure for less than the total amount owed on the mortgage and the lender servicer forgives any shortage.

 

Repayment Plan

The lender gives the homeowner a fixed amount of time to bring delinquent mortgage payments current by paying the normal monthly payment plus an additional amount.

 

Forbearance Agreement

An agreement that allows the homeowner to pay less than the full amount of the mortgage payment or pay nothing for a given period (the regular monthly payments remain due).

 

Reinstatement

Reinstatement occurs when the homeowner brings a delinquent mortgage current or “cures the default” by paying the total delinquent amount.

 

Loan Assumption

Even if your mortgage isn’t assumable, your lender may allow someone else to take over the payments and bring the loan current. This may allow you to sell your home.