HAUP Mortgage Forbearance for Unemployed Homeowners

by MB from Salt Lake City, Utah

Ask Kate about HAUP Mortgage Forbearance for Unemployed Homeowners - Making Home Affordable Unemployment Program: Taking the sting out of losing a job, wouldn't you be delighted to find your mortgage payments have been suspended for a year, or even longer.

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Or what if your monthly house payments were reduced to 31% of your pretax income until your mortgage loan could become permanently modified? If you are an unemployed homeowner struggling to make your house payments, don't miss my answer about mortgage forbearance to MB.

MB Asks Kate How to Refinance a Sub-prime Mortgage

Hi Kate, I have a non-prime mortgage at 123% LTV but no late house payments. I make too much money to modify my mortgage through HAMP. My loan also is not eligible for HARP 2.
HAUP Mortgage Forbearance for Unemployed Homeowners

I paid $165,000 for my house which is now only worth roughly $125 to 130,000. I have a $340 monthly private mortgage insurance payment on a original loan of $156,000.

The interest rate is 7.625%. The total payment is $1695 a month.

I have tried to refinance on multiple occasions, tried HARP and everything. I bought the house in 2007. Since then, I have always paid and have been laid off 3 times.

Apparently, I make too much money, so I'm not considered a hardship case. My loan also continues to be transferred from First Horizon, Metlife, IBM lender business solutions, and now Seterus (who only services the loan, but doesn't own the loan.)

I recently tried to refinance thru HARP with Quicken Loans and they wouldn't even process my mortgage application because I have a non-prime loan.

What can I do? MB

P.S. I have a crummy credit score of 620.

Kate Answers: HAUP Mortgage Forbearance for Unemployed Homeowners

***zz-portrait-left.shtml*** Dear MB,

As harsh as Quicken Loans' reaction may have seemed, only mortgages backed by Fannie Mae and Freddie Mac are eligible for the HARP 2 Refinance Plan.

But the program I'm about to show you is only for home loans NOT backed by Freddie Mac or Fannie Mae. (You weren't expecting that guideline, were you?)

It's called the Making Home Affordable Unemployment Program or yet another acronym, HAUP.

Who Qualifies for Home Affordable Unemployment Program (HAUP)

While your lender might not consider you to be a hardship case today, you should know about these benefits for unemployed homeowners - in the event you are laid off for the 4th time.

Unemployed homeowners who've never received a HAMP loan modification could be considered for HAUP.

You must be eligible for unemployment benefits and live in the home as your primary residence. In other words, the home cannot be used as a rental property.

Your financing must be less than $729,751 and originated before January 2, 2009.

How HAUP Benefits Unemployed Homeowners

Participating HAUP lenders through Making Home Affordable can offer eligible unemployed homeowners a one year or longer mortgage payment forbearance. Or lenders may require a partial payment, yet not to exceed 31% of monthly pretax income including unemployment benefits.

Homeowners are evaluated for a HAMP mortgage modification at the end of the HAUP forbearance period assuming HAMP loan modifications are still an available program.

Read about other innovative plans offered through the Making Home Affordable Program here.

Best wishes for your home and your mortgage,

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P.S. Although HAUP is not for mortgages backed by Fannie or Freddie, these lenders have their own forbearance programs for unemployed homeowners.

If you have a friend whose home is financed by a Freddie Mac or Fannie Mae lender, they can call the toll-free servicing number on their loan statement for more information about mortgage forbearance.
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Comments for HAUP Mortgage Forbearance for Unemployed Homeowners.

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Forbearance for Second and Rental Homes
by: Mark from Virginia

Kate, I have 2 investment properties and have lost my job. I plan to request forbearance for the homes and is forbearance an option? Mark

Hi Mark, Kate here...

Making Home Affordable website says forbearance is for owner occupied homes. You can read the forbearance program overview on this page.

However, I would not let guidelines stop you from calling your loan servicer to request a forbearance. There are many variations to the program. So don't hold back. Go for it!

Get ready for the call by having your income documents available. Be prepared to share your hardship details.

Best wishes, Kate

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