Fannie Mae and Freddie Mac, the backers of most mortgages in the United States, have announced that by July 1 they will re-evaluate borrowers for a new mortgage modification under the following criteria:1. if the borrowers are more than two months behind on mortgage payments; or2. If borrowers are current but in danger of falling behind after a HAMP reset (as long as the borrowers have less than $25,000 in cash reserves).These changes are coming up because the modification program known as HAMP, is now over 5 years old. Many modifications contain language allowing for an interest rate increase after 5 years. The federal government, and some observers, have worried that rate resets could send some borrowers back into default.In a statement, a spokesman for the Federal Housing Finance Agency, which regulates Fannie and Freddie, said the agency "worked with Freddie Mac and Fannie Mae to ensure that borrowers who may be facing hardship as a result of an interest rate reset on their HAMP loan modification have options that allow them to remain in their homes. In most cases, keeping borrowers in their homes is the most beneficial outcome for all involved, including taxpayers, and we will continue to monitor these loans and make adjustments as necessary."If you already have a loan modification, or if you believe that an interest rate could help you stay in your home, please contact me for a free consultation.Eric Singleton, Attorney 801-214-9200
