I'm unemployed what are my options for a loan modification or a reduction in mortgage payment?

Under the Home Affordable modification program if you are unemployed you may be eligible for a loan modification or forbearance under the governments UP program.

I am in a trial loan modification but just lost my job? You can still apply for assistance under the UP program for unemployment.  Once the servicer confirms you will be getting unemployment benefits, they should offer you a forbearance plan.  They will not need to wait to confirm you are receiving the unemployment benefits.  The plan will let you pay a reduced mortgage payment for about 3 months and can be extended if warranted.  Servicer's will be able to track your employment status to determine when you may be able to be flipped back into a trial loan modification at the time of your new employment.

How do I go about applying for a UP forbearance? You can apply for UP consideration can be made by phone, mail or email.  Your servicer must document your request and date the UP request in your file.  After receiving your evidence of unemployment benefits, the servicer is then required to determine if you are eligible for the UP program. If for some reason you do not qualify your servicer must send you a non approval notice within 10 business days following the date of the servicer's determination.

What happens if I am eligible for UP what happens next? If you are eligible for the UP program or an extension the servicer must send you the terms of the forbearance plan.

Duration of the forbearance plan along with the Forbearance Period Effective Date and

the expiration date;

Periodic payment amount, if any;

Brief explanation regarding what will occur when the borrower is re-employed or when

the forbearance plan expires; and

Borrower's responsibility to provide updates to his or her employment status during the

forbearance plan, if applicable.

2mp tidbits

The Second Lien Modification Program (2MP) seeks to lower payments on second lien mortgage loans. Under 2MP, when a borrower's first lien is modified under HAMP, a participating 2MP servicer must offer to modify the borrower's second lien by:

Modifying the borrower's second lien mortgage;

Accepting a lump sum payment from Treasury in exchange for full extinguishment of the second lien; or

Accepting a lump sum payment from Treasury in exchange for a partial extinguishment and modify the remaining borrower's second lien.

For more details outlining this program you can visit the Making Home Affordable website.