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Home Affordable Modification Program

The Obama Administration is making changes to its Home Affordable Modification Program that will ease the transition to a trial modification to a permanent loan modification.

Under this new plan, if a borrower successfully meets trial modification payments for a period of three consecutive months, the trial modification will automatically roll over into a permanent mortgage loan modification.

This doesn't mean that every borrower is automatically eligible for loan modification, however. There are some circumstances in which foreclosure is actually in the borrower's best interest. It's up to the lending institution to make this determination, taking into consideration whether the borrower or the lender will benefit from a modification. It is important to note, however, that lenders are required to grant loan modifications if either party will benefit - so borrowers don't have to worry about being denied because the lender doesn't want to deal with the administrative work.

Under pressure from the government to make this program work, big-name lenders, including Citi and Bank of America, are pushing to offer modifications to lenders in lieu of foreclosing on properties.

If you've fallen victim to the current economic conditions, whether it's due to loss of income or a decrease in the value of your property and are having trouble meeting your mortgage payments, call your lending institution to ask about available loan modification programs before resigning yourself to losing your home to foreclosure. When implemented property, the loan modification programs are working well for many families.