Foreclosure prevention: Basic eligibility guidelines

Here are the basic guidelines for the Obama administration's mortgage-modification and mortgage-refinancing package. A full discussion is available at the U.S. Treasury Department's Web site, www.FinancialStability.gov.

Who will be helped by the Making Home Affordable Program?

It will offer assistance to seven million to nine million homeowners, either through refinancing their current mortgages to more-affordable payments or by otherwise modifying their loans.

Who is eligible for the refinancing?

Up to five million homeowners who have a solid payment history on an existing mortgage owned by Fannie Mae or Freddie Mac can apply. Typically, these borrowers are unable to refinance because their homes have lost value and because they have less than 20 percent equity in the property.

What's the deadline?

The refinancing part of the program ends June 2010. Mortgage modification will be available through Dec. 31, 2012.

How can I find out who owns my loan?

Call your mortgage servicer or lender (the organization to whom you make your monthly mortgage payments). Or ask Fannie Mae (1-800-732-6643, www.fannie-mae.com/homeaffordable) or Freddie Mac (1-800-373-3343, www.freddiemac.com/avoidforeclosure/) directly.

Who is eligible for mortgage modification?

Up to four million homeowners in danger of foreclosure if nothing is done to make their loans more affordable are eligible.

Which mortgages qualify for the program?

Loans for owner-occupied properties originated on or before Jan. 1, 2009, are included. Mortgages for investor-owned, vacant, or condemned properties do not qualify.

Is there a limit to the unpaid balance?

Yes, eligibility is capped at $729,750 for first mortgages on single-family homes. Higher limits are allowed for owner-occupied properties with two to four units.

What paperwork must I provide?

Before you contact your loan servicer, make sure you are able to fully document income, including a signed IRS transcript of your most recent tax return and your two most recent pay stubs. You also must sign an affidavit of financial hardship.

How will owner-occupancy be verified?

Borrowers' credit reports anwd other documentation will be used.

I have two mortgages. Will a Making Home Affordable modification reduce the payments on both?

Only the first mortgage is eligible for a modification.

- Alan J. Heavens