The Mortgage Bankers Association proposed a forbearance program Wednesday aimed at helping the unemployed pay their mortgages for up to nine months.
Under the proposal, loan servicers would reduce eligible borrowers’ monthly payments to no more than 31% of their household income for up to nine months. Unlike a modification, however, the arrears would be tacked onto the end of the mortgage.
As part of the proposal, the association has asked the Treasury Department to provide loans to some servicers to cover payments to the mortgages’ investors. Treasury officials, who met with the group last week, have not made yet a determination, a spokeswoman said.
The trade group’s goal is to address the growing number of people who are falling behind on their mortgages because they’ve lost their jobs.
“Borrowers with such a precipitous drop in income can’t qualify for most loan modification programs, so we are looking for ways to allow those borrowers to keep their homes while they look for another job,” said John Courson, the association’s chief executive.
Once borrowers find new employment, they will be considered for a long-term modification under the Obama administration’s foreclosure prevention program.
FULL STORY: http://money.cnn.com/2010/02/24/real_estate/forbearance_for_unemployed/index.htm
Comments
we got a loan mod. 1 year ago, our subprime got to 13% @ $1,400 a month when we were told it would not go over $100 for the term of loan, but what they later said was they meant $100 @ each adjustment, so they lowered it to 7% @ $900 a month. i am now unemployed and they say that because it is not permanent situtation i am not qualified for obama’s housing plan, it took 6 months for them to make this determination all the while i was struggling to make payment because you cannot fall behind on mortgage when applying for obama plan. EMC my mortgage servicer has not given me any other options or help. i hope that they will adopt this forbearance plan, god knows that the interest that is $800 of the $900 payment is enough to let us ride for free for a while.
#Do you Want to say something?