Homeowner Affordability and Stability Plan - Fact Sheet and Links

It's a massive programs that's designed to help millions of homeowners avoid foreclosure over the next few years. But aside from that, many people don't know what the Homeowner Affordability Stability Plan is, or what it's supposed to do. Here's a simple explanation:

What Is This Plan?
For one thing, it's a mouthful. The official name of this program is the Homeowner Affordability Stability Plan, but it's commonly referred to by the media as the housing plan and the mortgage relief plan. This program is a major part of President Barack Obama's overall strategy to get the U.S. economy back on track. It was initially unveiled during a press conference on February 18, 2009, when the president was in Phoenix, AZ. The program is expected to cost $75 billion.

What Is It Designed to Do?
The Homeowner Affordability Stability Plan is intended to help more than 7 million homeowners / families avoid foreclosure. In this respect, there are two primary parts of the plan:



The modification side of the plan focuses on homeowners who are falling behind on their payments and at risk of defaulting. The goal here is to restructure the loan (mainly be reducing the interest rate) in order to make the monthly payments more affordable.

The refinancing side of the program focuses on homeowners who are current on their mortgage payments, but are unable to refinance because of a drop in property values (a common predicament in the current economy).

Who Qualifies for This Plan?
On the refinancing side of things, you must be current on your mortgage payments to qualify, and your home loan must be owned by Freddie Mac or Fannie Mae. It must be a "conforming" loan, meaning the original mortgage amount was less than $417,000 (except in certain expensive cities). You'll need to contact your current lender to find out if your loan is owned by Fannie or Freddie.

On the mortgage modification side of things, the effort is focused on homeowners who are behind on their payments and need help to avoid foreclosure. The home loan must have been originated before January 1, 2009. The unpaid principal must be less than $729,750.

Where Can I Learn More?
To learn more about the eligibility criteria for the Homeowner Affordability and Stability Plan, visit the new FinancialStability.gov website. Look for the self-assessment tool, which you can use to determine your eligibility for assistance. Here's the line:
http://www.financialstability.gov/makinghomeaffordable/