Streamlined Modification Initiative
The Streamlined Modification Initiative created by the Federal Housing Finance Agency (FHFA) only applies to first-lien mortgages on all homes insured by Freddie Mac or Fannie Mae.
Effective immediately, homeowners seriously delinquent on mortgage payments have help avoiding foreclosure thanks to the Federal Housing Finance Agency (FHFA). The Streamlined Modification Initiative introduced by the FHFA will eliminate loan modification problems by offering qualified borrowers lower mortgage payments without providing financial documents and hardship explanations.
The benefits, requirements, and eligibility of the Streamlined Modification Initiative include the following:
(1) Allows approved applicants who are 3 months – 2 years behind on payments to receive a payment offer with a 3 month trial period.
(2) The new offer has a lower payment, and fixed interest rate attached to a 40 year mortgage.
(3) Homeowners considered underwater on home values are provided a principal forbearance.
(4) Before qualifying, homeowners are required to provide financial documentation to satisfy other mortgage modification options.
(5) Modifications only apply to loans at least one-year old guaranteed by government sponsored enterprises Freddie Mac and Fannie Mae.
(6) These loans must be conventional first-lien loans having at least a 80% loan-to-value ratio.
(7) Eligible property types include: primary residence, second home, investment property, vacant properties (including condemned properties).
This program has a termination date of August 1, 2015. Click the below reference links for additional requirements, FAQ’s, and fact sheets.
References:
FHFA News Release (dated 3/27/2013)
Freddie Mac Streamlined Modification
