| Are you one of the millions of American homeowners | | | | looking at restructuring your loan to make it more |
| who has been suffering from the economic recession | | | | affordable. If your loan is backed by Fannie Mae or |
| and is worried about paying your mortgage this | | | | Freddie Mac, then you can participate in the President's |
| month? If so, you need to talk to a financial counselor | | | | new Making Home Affordable mortgage loan |
| today about home loan modification vs. FHA | | | | modifications. If your loan is backed by the FHA, then |
| refinancing. | | | | look into special refinances made possible by the Hope |
| Two of the best options available to homeowners | | | | for Homeowners plan. |
| who have been painted into a corner with their home | | | | In the case of an FHA loan, look into refinancing. The |
| mortgage loans are loan modification and FHA | | | | Hope for Homeowners initiative makes refinancing |
| refinance, and which one is right for you depends | | | | possible to those who previously were denied a |
| mostly on who insures your loan. To find out, call your | | | | refinance. Falling house prices have disqualified a lot of |
| lender and request that information. The three big | | | | people for refinancing they desperately need. As |
| insurers of mortgage loans are Freddie Mac, Fannie | | | | house values have fallen, so have their levels of home |
| Mae, and the FHA (Federal Housing Administration.) | | | | equity. If they drop below 20% home equity, they were |
| None of these companies actually lend the money, but | | | | unable to refinance in the traditional way. |
| they are commissioned by Congress to insure 100% | | | | Loan modifications through the Making Home |
| of the loaned amount of money. This minimizes risk for | | | | Affordable plan follow a standard chain of steps for |
| the lenders and gives you the chance for a better | | | | lowering your monthly payments. The plan includes |
| interest rate. | | | | incentive payments to both lenders and borrowers to |
| What is the difference between Fannie Mae/Freddie | | | | facilitate successful loan modifications and encourage |
| Mac loans and FHA loans? Well, not a whole lot. It just | | | | economic stability. If you have an FHA loan, you can |
| depends on your specific mortgage loan and who | | | | still modify it but not through the Making Home |
| insures it. There is no major difference between an | | | | Affordable plan. The programs that handle FHA loan |
| FHA loan and a loan owned by Fannie Mae or Freddie | | | | restructures do not follow procedures that are quite as |
| Mac. The only time it really matters is when you're | | | | streamlined or as strict. |