Assistance Available For The Unemployed

It’s a well-known fact that the loss of employment is one of the major reasons a homeowner loses their home to a foreclosure . That makes sense really, as if you are no longer bringing home a paycheck, how can you hope to make monthly mortgage repayments. The worst thing about it is the fact that you may have lost your job through no fault of your own. Lower consumer spending has resulted in many companies having to cut back on staff. If you’ve recently been made unemployed and don’t have much of a savings pot to fall back on, I’m sure you’re probably panicking right about now, asking yourself “how the hell are we going to pay the mortgage?” The first thing you should do in this situation is call up your lender, explain the situation clearly and see if you can negotiate lower repayments or something that will just give you a bit of breathing space until you find another job. If the lender is not willing to help out though, there are other options available to you such as the programs outlined below.

Home Affordable Unemployment Program (UP)

This is an initiative that was brought in by the Obama government that aims to help you by either temporarily decreasing your monthly installments to a manageable amount or freezing mortgage repayments altogether for a period of 12 months or more. Both of these outcomes would hopefully ease your financial worries until you were able to get a new job. Eligibility for this program will depend on whether your lender is participating in the program though. Participating lenders generally have the following requirements:

• You must be unemployed and able to claim unemployment benefits.
• The home in question must be your main residence.
• You have not previously been the recipient of a HAMP loan modification.
• You took out your mortgage loan prior to the 1 st of January 2009.
• Your mortgage balance must not exceed $729,750.

FHA Forbearance For Unemployed Homeowners

For any of you that don’t know, forbearance is where you make an agreement with your lender to put a foreclosure filing on temporary hold, in order to give you a chance to get your financials sorted out. The Federal Housing Administration brought this new scheme in last year and it will continue to operate until the summer of 2013. The changes that have been made mean that lenders are obliged to give any borrower who qualifies, a forbearance period of 12 months (increased from the standard 4 months). This scheme also makes it easier for a borrower to be eligible.

Qualifying For A Loan Modification If You Are Unemployed

Many people think that if you are out of work, you are automatically unable to make a successful application for a loan modification. But that’s not necessarily true.

• Any unemployment benefit received from the government will be assessed as a form of income and may be sufficient to allow you to qualify for a loan modification. The lender will take various things into account such as how much you are receiving from this benefit, how often it is received and if it is likely to last for an extended period of time.
• If these benefits don’t allow you to qualify you could think about taking on a lodger to boost your monthly household income. This could demonstrate to the lender that you will be able to meet altered loan rates and tip the scales in your favor.

As you can see, if you have been unlucky enough to lose your job, there are still options that may allow you to continue paying your mortgage off and keep hold of your home.

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