President Obama has introduced a loan modification plan that homeowners can apply for under the MHA or Making Home Affordable Act. There are several guidelines to follow in order to be able to qualify for this program.

Homeowners who would like to apply under this program have to give proper justification as to why they have not been able to make their payments accordingly. The best way to achieve this is to include a hardship letter with the loan modification form. In order to do this a borrower must do some research online where they can read instructions online to write the letter as required. This letter will add a human touch to the numerical data submitted. Some of the requirements that this letter must touch upon are,

-You realize that you haven’t fulfilled the terms and conditions of the original loan contract and you are now confident of making the relevant payments

-The reason why you lagged behind in your payments

-Explain that the situation was merely temporary and you will be able to meet the requirements as necessary

-You proposal, which states your justification in this regard

-Prove with facts and figures your calculations as to how you are going to budget your new payments

The requirements of the bank are relevant, where the borrower must be able to show upon impression that they are willing to make a commitment in case their loan modification is approved. The problems that have so far caused the borrower to lag behind in their payments must now no longer exist and an assurance must be given to the lender that they are indeed confident hereafter.

The borrower needs to show their monthly gross income and all their expenses, including bills, taxes, loan payments etc. The borrower will also have to justify an income ratio of 31 percent to their debt under the new MHA program that has been proposed by Obama. A misunderstanding among people is that the Homeowner Stability Initiative assists house flippers and speculators. This is a misconception. Under the MHA plan, in order to qualify for a loan modification, the homeowner must be living at the address of the home for which they are applying for a mortgage. Second homes, vacant homes, investment properties and condemned homes are not eligible under this program.

It is best not to delay too long, since Obama’s plan is not going to be around forever. Learn how to qualify for the MHA and also get help from a customer service agent to assist you.