This extension ensures that eligible homeowners will continue to have access to HAMP’s mortgage relief through December 31, 2015, which is also the deadline for the recently extended Home Affordable Refinance Program (HARP) as well as Fannie Mae and Freddie Mac’s new Streamlined Modification initiative.

As the organization that provides free housing counseling for homeowners applying for all Making Home Affordable initiatives, including HAMP and HARP, HPF heartily supports the extension. HPF’s HUD-approved housing counselors are standing by at 888-995-HOPE (4673) to answer homeowners’ questions about the programs and to offer independent, third party guidance to all those who are struggling with their mortgages.

A few facts about HAMP:

• Since March 2009, more than 1.1 million homeowners have received permanent loan modifications via the HAMP program
• HAMP modifications lowered a homeowner’s mortgage payment by an average of $546, which equates to a 38% savings
• The HAMP program was extended in June 2012 to include homeowners who: are applying for a modification on a home that is being used for rental purpose, have a debt-to-income ratio that is 31% or lower, or defaulted after receiving a HAMP modification during the trial period or after it had become permanent

For more information about the eligibility requirements for HAMP, visit the Making Home Affordable website at www.makinghomeaffordable.gov or call 888-995-HOPE (4673) to speak with a professionally trained housing counselor.

Borrowers – including those applying for a loan modification under the Making Home Affordable program – are often required to submit “hardship letters” that explain to their lender why they have missed their payments or are struggling with their mortgage. In the article, New York Times contributor Lisa Prevost lays out extremely helpful advice on what and what not to include in the letter, including that homeowners should stick to the facts and avoid being overly emotional.

In addition, we’ve compiled a short list of hardship letter tips from our team of housing counselors:

• Include the timeline: Be very specific regarding when the hardship occurred and how that has since impacted your financial situation.

• Describe what has been done to improve your situation: Mention what steps you have taken to attempt to get back on track after the hardship. Examples including eliminating cell phone or cable bills, or searching for a roommate to bring in extra income.

• Explain what you are hoping for: Describe the type of mortgage relief you are applying for (loan modification, refinance, etc.) and explain how it will help your situation (i.e. it will lower the mortgage payment by $500, which would make it affordable).

• State recent communications with servicer: It’s best to include what steps have already been taken with your servicer, including the last time you were in contact and what types of things were discussed. 

• Be truthful: Sharing incorrect information complicates the situation and can delay a resolution.

Most importantly, homeowners need to know that they don’t have to go through this process alone. HPF’s housing counselors, who are available by calling 888-995-HOPE (4673), will walk you through every step of your mortgage resolution process, from filling out the paperwork to writing the hardship letter. Our counselors even facilitate discussions between you and your lender by hosting a three-way phone call to discuss possible solutions. Having the support and guidance of an independent, third party expert can make all the difference when it comes to finding an alternative to foreclosure.

The data, which was released in this December Congressional Report, also featured statistics underscoring the efficacy of foreclosure prevention counseling, including that homeowners who completed NFMC counseling were twice as likely to receive a loan modification.

Another statistic featured in the report is the default rates among homeowners who received loan modifications – those who were counseled were 67 percent more likely to remain current on their mortgages in the nine months after receiving a modification. Additionally, those who qualified for the Home Affordable Modification Program (HAMP) and completed counseling experienced a high level of success, lowering the overall loan modification re-default rate by 83 percent. The Urban Institute independently verified all findings.

The positive statistics referenced in this report match data that NeighborWorks released in June of 2012 (see press release on that report here). That the counseling results remained consistent over the course of the year underscores the value of third party, independent housing counseling like that offered through the NFMC program.

In the Hoffmans’s case, a letter from the OCC and Treasury’s Independent Foreclosure Review program prompted them to reach out for additional guidance despite already having tried countless solutions beforehand. After being transferred to an HPF housing counselor at 888-995-HOPE, the Hoffman’s discovered the benefits of working with a neutral, third party expert and were able to reach an agreement with their servicer within weeks.

Thanks to the Hoffmans for sharing their story, and to the Beacon’s Mary Delach Leonard for reporting it so passionately; it’s stories like these that inspire other homeowners facing foreclosure to reach out for help and to not give up.