There have been many people asking us about the new rescue plan that the president is putting in place to help home owners stay in their homes.  Below is some helpful information that should help some home owners...Just keep in mind that people still need to be able to document their income in order to qualify for these modification programs.  Many people in Downey, Lakewood, Paramount, Whittier, South Gate, and the surrounding cities including North Orange county cities such as Huntington Beach, bought homes with STATED income loans.  Many times STATED income loans were used because buyers couldn't document their income using standard methods like pay stubs and taxes.  People were sometime payed "Under the table Income" or simply used their self employment status to deduct many of their expenses allowing them to pay less taxes but unfortunately hindering them when qualifying for "FULL DOCUMENTATION" loans...Although these programs may help some families, they won't  help all of them and that is the reason why we are still listing and selling many Short Sales in this market. 

We do recommend attempting to try to modify if you meet the criteria below and we truly understand how difficult it is for families to unwillingly lose their homes in these difficult times.  Just know that we are here to help families escape that reality of foreclosure.  With Short Sales, families can save their credit from the damages of foreclosure be able to buy again in the near future.  We do not recommend paying for the service of a modification.  Many services will take your money and offer no guarantees of successful outcome.  You can contact the bank directly and they can be of service to you.  If you ever need anything or have any questions about your home, please contact us.  You can reach us at (562) 883-1003 or (562) 746-3811.

Read below for more info on the loan modification process...

Pres. Obama's foreclosure prevention program will help some 9 million struggling homeowners keep their homes. The financial fix requires companies to help borrowers by adjusting their loans so that their monthly house notes do not exceed more than 31% of a borrowers monthly gross income. And, if you are a borrower who hasn't missed a payment, you may be eligible to refinance into a lower cost loan even if you have little or no equity.

Under the $75 billion plan, borrowers, loan servicers and investors will receive government incentives designed to bring about mortgage modifications. In addition, the program will allow subsidized interest rate reductions to help borrowers afford their monthly payments.

"This plan will help make home ownership more affordable for nine million American families and in doing so, help to stop the damaging impact that declining home prices have on all Americans," said Housing Secretary Shaun Donovan.

Starting today, borrowers can begin contacting their loan servicers and lenders to see if they are eligible for the program. This program will be promoted nationwide at homeownership events. Additional eligibility criteria and program guidelines were revealed today by the Obama administration. This loan modification program targets homeowners who are behind in their payments or at risk of losing their homes.

Federal officials define the term "at risk" as those: suffering serious hardships, declines in income or increase in expenses; facing an interest rate hike; having high mortgage debt compared to income; owing more than their house is worth, or demonstrating other reasons for being close to default.

To participate in the loan modification plan, borrowers must:

• have obtained their mortgage before Jan. 1, 2009;
• have a primary mortgage of less than $729,500;
• live in the property;
• fully document their income by providing tax returns and pay stubs;
• sign a statement of financial hardship; and
• go for counseling if their total household debt - including auto loans, credit cards and alimony - totals more than 55% of their income.

The modification program will be in effect until the end of 2012, but loans can only be adjusted once.

Officials also unveiled more details on how servicers will modify the loans. First, they must reduce interest rates so that borrowers' total house payments are not more than 38% of their monthly income. The government will then subsidize servicers dollar-for-dollar to lower that ratio to 31% - but the interest rate can't go below 2%.

The new interest rate would then remain in place for five years, after which it will increase by 1 percentage point a year until it reaches either the original rate or the prevailing mortgage rate at the time of the