Apply For Home Affordable Refinance Program and Make Your Home Free From Foreclosure

The making home affordable program was designed to help homeowners from losing their homes to foreclosure due to inability to afford monthly mortgage loan repayment. Financial crisis can strike any time and it is up to the homeowners to decide which path they want to go even before any sort of tragedy strikes them. Resorting to home affordable modification program or home affordable refinance program that are two branches of the federal making home affordable program even before the homeowner starts facing problems with the monthly payments can lead to prevention of a situation wherein they might have to face foreclosure.

Prevention is always better than cure and by taking the help of federal making home affordable program the homeowner can resolve his crisis way ahead of time. Out of the two parts of the federal making home affordable program the home affordable refinance program was applicable only to those homeowners who had their mortgage loan guaranteed by Fannie Mae or Freddie Mac. Mortgage loans which were not guaranteed by the two insurers could not qualify for the home affordable refinance program. Other criterion's that need to be met to qualify for the home affordable refinance program following the making home affordable program guidelines are as follows:

• The mortgage loan should be guaranteed by Fannie Mae or Freddie Mac. Out of the two Fannie Mae has greater market share than Freddie Mac but both the insurers have online look up services.


• The homeowner should be able to maintain a perfect and on time mortgage repayment history across the previous 12 months. A case of late payment even once can lead to disqualification from the home affordable refinance program as per the making home affordable program guidelines. Being 30 days late on ones payment means the homeowner cannot qualify any how whereas being 20 days late will enable one to qualify if the late payment fees have been discharged.


• The outstanding balance on the mortgage should not exceed the value of your home that is it should not be more than 5% of the home's value. The formula for calculating the balance is by dividing mortgage balance with the home value. After division if the quotient turns out to be greater than 1.05 then it means that the loan to home value has exceeded 105% and the homeowner cannot qualify for the home affordable refinance program.

However, if the person meets all the eligibility criteria as stated in the making home affordable program guidelines then few points need to be kept in mind before applying for the refinance program. They are:

• Mortgage insurance need not be paid after refinancing if prior to refinancing the homeowner did not pay for mortgage insurance. This will be applicable even if your home value and mortgage balance ratio increases by 80%.


• Show valid proof of income as all home affordable refinance program applications carry out verification of income before approving the refinancing program. Mortgage refinancing is only applicable to first mortgages and not second mortgages.


• The making home affordable program guidelines does not require minimum credit score, mortgage insurance, offers up to 105% LTV and re-subordination of all current subordinate financing without resorting to new subordinate financing.

The home affordable refinance program which is a sub part of the making home affordable program is a beneficial tool for homeowners to save their homes from foreclosure. With the help of the making home modification program and the making home refinance program homeowners can pay off their mortgage loans and at the same time reap the benefit of staying in one’s home.

Jack Smith is a regular writer on Obama-loanmodifications.com, a US based portal, which provides detailed information on Federal making home affordable program, Streamline FHA refinance Program and other Obama Mortgage Rescue Plan related issues.