More than 5 million Americans will be helped by the Loan Modification Plan for Homeowner Stability Initiative to reduce their monthly payments and evade foreclosure. Let us find out whether you qualify for participation or not.

The economic slowdown is affecting many people. Some people are losing their jobs and others are taking pay cuts. This leaves very less money, if any with the people to pay the monthly mortgages. This is the reason why American foreclosures have reached the highest ever in history. The Making Home Affordable Refinance program was introduced to give stability to the housing market as well as the economy. Homeowner Stability Initiative of $75 billon is included in the plan.

As said earlier, there are many homeowners who have lost their jobs and received pay cuts in these times. This gives them little room to repay their monthly mortgage payments. Making Home Affordable plan will help such people to stay in their own homes by facilitating home loan modification.

This plan encompasses payments in the form of incentives, both for borrowers as well as lenders. $100 will be gives to lenders as a servicer incentive payment for every successful and eligible loan modification. They will also receive up to $100 every year for a period of 3 years if the borrowers are regular on the home affordable modification.

There are certain eligibility parameters which need to be fulfilled. To qualify for loan modification your loan should ether be insured by Freddie Mac or Fannie Mae. The loan should have started before 1st Jan ’09. The unpaid principal amount on your loan should be less than $729,750. It should also be noted that you have to be a primary resident of the home and not an investor.

The plan is Obama’s loan modification help effort to stabilize the economy by helping people who are experiencing difficulties. By preventing foreclosures, the government will help people to stay in their own homes. Borrowers who qualify for the Standard Waterfall will be able to reduce their monthly payments up to 31% of their monthly income.