The world has suffered badly at the hands of the financiers in high office, there is a lot of talk about subprime loans and toxic debt being so bad that it is said to have brought countries to their knees and to be fair, it has. We have seen this first hand through stock price losses, frantic attempts to control economies through interest rate cuts and the many incentives such as quantitative easing that have been used to stimulate flagging economies in various forms all around the world. whoever thought that governments would offer you money to scrap your car, desperate times indeed.

But on a more personal level, many people are facing foreclosure on houses that are no longer worth the mortgages taken out on them and the home loan mortgage lenders could soon own as much property as the Roman Catholic Church, maybe even more.

So enter the 'Make Home Affordable' program introduced under the approval of the new president, Barack Obama as part of the stimulus package for 2009. Many people refer to it as the new stimulus package, probably because there was actually an old stimulus package, for homeowners anyway, that actually still exists and was introduced under the Bush presidency.

This was called the 'Hope for Homeowners' program, the rules and eligibility for this program are a little different to the new stimulus package, which incidentally isn't just for homeowners there is a whole rake of initiatives in there to stimulate one thing or another, although the focus of this hub is going to be on the homeowners options.

Confused yet???? No, then I can't be trying hard enough.

Ok so lets try and make a little sense of at least some of this, I am going to focus now and try and provide some information that might actually be useful to someone. How I am going to do this is by clearly stating what the options are under the make home affordable program and how you know if you are eligible for any of these options.

Option Number 1 - Mortgage Refinancing

For this one you need to be up to date on your mortgage repayments and it is only available until June 2010

Option Number 2 - Loan Modification

This is for people who have got into hardship and are struggling to meet their mortgage payments or may have already fallen behind on their payments and are under threat of foreclosure.This scheme ends on the 31st December 2012

To be even considered for a mortgage refinance under the 'Make home affordable program' you need to meet the following criteria: -

1. You need to own as your first residence a 1-4 unit home and to be living in one of the units
2. Your mortgage payments cannot be in arrears i.e. less than 30 days late in the preceding 12 months or no missed payments for a mortgage less then 12 months old.
3. Your loan amount should not equal more than 125% of the current valuation of your home(used to be 105%, but got increased)
4. You must still have sufficient income to make the payments on a refinanced mortgage, sounds odd but you may have lost your job for instance.
5. The refinancing must improve on the long term stability or affordability of your loan
6. Your mortgage must either be with or securitized by Freddie Mac or Fannie Mae

This is the starting point for consideration, you still need to make the application and it is possible that ultimatley you may not be accepted onto the program. On the other hand if you feel once all the details are worked out that this does not leave you in a better position then you don't have to agree to it and go ahead.

The rules for loan modification are somewhat different and I suppose one of the most important aspects is that the mortgage can be with a lender other than Freddie Mac or Fannie Mae.

So here is the criteria: -

1. You have to be the resident of a house that is your family home.
2. The total costs of your first mortgage repayments, this includes things like tax and insurance, capital repayment and interest on a monthly basis must be more than 31% of your gross income per month.
3. Your current mortgage must not be more than $729,759 capital owing
4. Your mortgage was not taken out after 1st January 2009

Again this is the starting point, you will need to explain why you are in hardship to your current lender and not all lenders will be taking part in the program, despite the incentives, so you need to find that out first.

Advice for the 'Make home affordable' program is free (in some States there may be a very small fee), to get help contact a HUD approved housing counselor. You do not have to pay a large amount of money to find out about the program or to apply to the program.

If anyone is asking you to pay a lot of money for help and advice then you should politely decline and go seek an approved housing counselor. before doing anything else.

I have provided links below to further information which you are welcome to review. This includes information on Bush's scheme 'Hope for Homeowners'.

A recent press release dated November 2009 has indicated that the HAMP (Home Affordabe Modification Program) is starting to work although progress has been slow so far. This program is due to run for 3 years, ending Dec 2012, so expectations are that the program goals of helping between 3 to 4 million homeowners will be met. Check out the RSS feeds below to access more detailed information.