Treasury Announces Less HAMP Paperwork

February 4, 2010 · Posted in News For Homebuyers

A year ago, the government launched mortgage relief under the Home Affordable Modification Program (HAMP). Unfortunately many homeowners in need of help found the paperwork requirements overwhelming and documents were sometimes lost in the process. So last Thursday, the Treasury issued new guidelines to simplify the paperwork for homeowners looking to lower their mortgage payments to avoid foreclosure.

According to the new guidelines, borrowers must present just three items to the loan servicers who collect their mortgage payments:

1.    a form requesting a loan modification;
2.    authorization for the servicer to get tax information from the IRS; and
3.    evidence of current income, such as two recent pay stubs.

In addition, the Treasury said that starting June 1, servicers have to collect all this information before they can start borrowers on a three-month trial modification. This is the period when borrowers demonstrate they can make the reduced payments, so they then can be granted a permanent reduction in their loan costs.
No longer do borrowers have to find the necessary tax returns, nor will servicers start the process without verified information. If you need assistance getting started, free help is available.