The Hope for Homeowners Program is Finally here!

The Hope 4 Homeowners (H4H) program is aimed at helping homeowners that have found themselves owing more on their mortgage than their home is worth. This program can actually reduce the amount that a homeowner owes on their mortgage which leads to a lower monthly mortgage payment.

How it Works?

The Hope for Homeowners program puts the homeowner into a mortgage based on their home's current value. A Hope 4 Homeowners’ loan will be 90% of the current value of the home. There are some negative aspects to the forgiven balance. The Federal Housing Administration (FHA) and your current lender will share in any profits of the house when the homeowner sells their home. This is to offset the balance that has been forgiven. There are enormous savings in the monthly payment because the principal balance has been reduced.

An Example:

Let’s say that your current mortgage balance is $400,000 and your home is now worth $250,000. Many homeowners find themselves in this scenario. The current mortgage payment is based on the old value of the home. 90% of the home's current appraised value will be the new Hope for Homeowners loan. $225,000 is the new loan mortgage balance in this scenario. That is a reduction of $175,000 in the principal balance of your mortgage. The new mortgage payment will be based on this new loan amount of $175,000.

How much will the Monthly Mortgage Payment be Reduced?

The principal reduction of your mortgage is not the only benefit to this program. The H4H loan payment will be reduced as well. Let’s say the current mortgage is $400,000 at 6% on a 30 year fixed (the benefits are even greater if you are in an adjustable rate mortgage). The current payment is $2,398. Let’s just assume that the Hope 4 Homeowners loan has the same interest rate as the current mortgage (all H4H mortgages are 30 year fixed). $1,348 would be the payment for the Hope to Homeowners loan. The mortgage payment is reduced by $1,050 monthly. There are obvious benefits.

There are some qualifying factors that homeowners need to understand. Now that you understand the benefits of the Hope 4 Homeowners program it is time to do a bit more research and find out if you can qualify for this program. This loan may have some negative aspects. You may give up some of the equity that your home builds when you sell your home. The H4H program allows homeowners to save their home. The H4H program can and will provide some much needed hope to homeowners that are upside down on their mortgage.

Find out more about the Hope to Homeowners program if you are interested. Hope 2 Homeowners