Mortgage Relief Military Hardship Resources

by Eric in Germany

Ask Kate about mortgage relief and military hardship resources: Homeowners in the military face unique hardships. But special resources are available to reduce underwater mortgage struggles. Resources include HARP 2 refinance, HAMP loan modification, repayment plans, forbearance plans, dedicated military homeowner help lines, and HAFA foreclosure alternatives.



Yet Eric's credit union's idea of relief from crushing mortgage payments is to give up on the condominium by short sale or deed-in-lieu of foreclosure. Service members will learn here how to access additional hardship resources.

Eric asks Kate for Military Mortgage Relief Options

Ask Kate about Mortgage Relief Military Hardship Resources and Options
Hi Kate, My wife owns a condominium in Laurel, Maryland (prior principal residence) with two Navy Federal Credit Union (NFCU) equity lines and loans.

The loans are current, however the payments are crushing. The total balance is $110,000 and the monthly payments are $1380.

She submitted a NFCU Making Home Affordable package requesting a refinance of the two loans. NFCU replied offer only HAFA or Deed in lieu of foreclosure. Unsure if the equity line or loans are associated with Fannie Mae or Freddie Mac.

She is in need of HARP refinance. We are stationed in Germany.

Kate Answers: Military Hardship Resource Options

Ask Kate at Get-Your-Best-Mortgage-Rate.com
Dear Eric,

Let's see if I can breakdown military hardship resource options.

Follow each of the links to other pages on my website that will explain the programs in more depth.

By learning your options, you can call back the credit union and see if you can engage them in a meaningful dialog. You may find they have more to offer than initially disclosed.

But your first step is to find out if your mortgage is backed by Fannie Mae or Freddie Mac.

Fannie Mae Military Mortgage Relief

If you discover the mortgage is owned by Fannie Mae, you can shop any mortgage lender who participates in the HARP 2 refinance plan with no loan-to-value restrictions. But chances are that mortgage rates and fees will be based on a non-owner-occupied status meaning increased cost to you.

Military hardship assistance may be available if you have Permanent Change of Station orders, are in or just leaving active duty, or you (or your spouse) have an active duty injury.

Fannie Mae's military hardship programs are executed by your lender and include repayment plans and forbearance plans, in addition to Home Affordable Foreclosure Alternatives (HAFA) or example Short Sale, Deed-for-Lease, Deed-in-Lieu, and more.

Repayment plans spread out past-due payments over several months until the mortgage is brought current. They are made on top of current house payments. Forbearance plans temporarily suspend or reduce mortgage payments for the term of active duty and an additional 3 months or longer.

Here's the icing on the cake! During the forbearance period, no late mortgage payment notices will be sent to the credit companies.
If your mortgage is owned by Fannie, call 877-MIL-4566 and tell them you are in the military.

Freddie Mac Military Mortgage Relief

Freddie Mac provides similar homeowner resources to military service members with a hardship. For example, a Permanent Change of Station is considered a hardship.

During active duty and one year afterward, homeowners with a hardship may be eligible for interest rate relief which caps mortgage rates at 6%.

For at least nine months after being released from active duty, loan servicers cannot initiate or resume foreclosure proceedings on eligible service members.
Freddie Mac’s dedicated help line for homeowners in the military is 1-800-FREDDIE, choose option 2, and then 3.

Making Home Affordable Military Mortgage Relief

Whether or not your mortgage is owned by Freddie Mac or Fannie Mae, you may be eligible for the Home Affordable Modification Program, HAMP.

There's even more icing on the cake! Relocated military homeowners may still qualify as owner-occupants, which means better mortgage terms than a non-owner-occupied property would receive.

Your lender may have programs similar to Fannie and Freddie. So now that you have educated yourself on current military hardship resources, ask your lender about each one.

If you aren't confident that the mortgage contact at the credit union understands available options, ask to speak with another representative.

Good luck and best wishes,

Ask Kate

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Forbearance Questions and how do I ask about HAMP 2 Program
by: Bonita from Virginia Beach, VA

I am a struggling homeowner in Virginia. I have been turned down for Loan Modification due to the investor does not participate in modifications. Bank of America services my loan, but the investor is Wells Fargo.

I am now 30 days behind on 80/20 loan that I made mistake in 2004. I have been working with a Default Counselor but makes promises to get back with me and never does. I have to end up calling his supervisor to get him to call me back.

I have worked with Consumer Financial Protection Bureau to get Bank of America to respond to my inquiry. My husband is active military and asked them about programs for Veterans. When I do get a chance to speak with Default Counselor, he never have any answers to my questions. I have been asking forbearance since September.

I always ask about new programs for homeowner like me that is struggling with underwater mortgage. I read something in pamphlet about the HAMP 2 program. I have a first and second mortgage (home equity). I cannot longer afford the payments. I have robbed peter to pay paul. All my credit cards are to the max. I have empty my savings. I living pay check to pay check.

Please advise on how to handle this situation. Thanks.

Hi Bonita, Kate here.

First of all, I want to apologize to you on behalf of the mortgage industry. I can only imagine the distress you feel.

Secondly, you are being given erroneous information. The following is taken from a list of participating Mortgage Servicers, published by Making Home Affordable:

Name: Wells Fargo Bank, NA (includes: Wachovia Bank, NA and Wachovia Mortgage, FSB)
Participating Programs: HAMP, Treasury FHA-HAMP, RD-HAMP, 2MP, FHA-2LP

Thirdly, I hope you'll call one of the Making Home Affordable housing experts at 888-995-HOPE. Identify yourself as a military family. Report the treatment you're receiving and ask for more help. Mention HAMP Tier Two (which primarily helps those who have previously failed HAMP or have rented their homes) and ask how it may apply to you.

Fourthly, if this does not work, what I'm about to suggest is unconventional. In fact, I believe this is only the 2nd time I've ever suggested going to the media, if memory serves me correctly. Read the information I gave to JL in Crawfordville, Florida at Home Mortgage Help for Disabled Veterans.

Lastly, while not the programs that homeowners dream of, I'd be remiss if I did not point out the Making Home Affordable Foreclosure Alternatives (HAFA). Go to HAFA Deed in Lieu, Deed for Lease, Short Sale Foreclosure Alternatives for more information.

Thank you for writing.

Sending my best wishes to you and your husband, Kate

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