More Details on Mortgage Help

The Treasury released more details on mortgage help programs aimed at reducing foreclosures.

There are 2 components to the plan:

• Refinancing help
• Mortgage modification help

Borrowers who've been unable to refinance because their homes have lost too much value may now be able to refinance. There are a lot of those borrowers, as yesterday's news that 1 in 5 US mortgages is underwater showed.

There's also hope for loan modification (see How Loan Modification Works). Loans may be stretched out over longer time periods, have reduced interest rates, or be calculated based on a lower loan balance.

To see how a loan modification would affect your monthly payments, see how changing the terms would look with our Loan Amortization Calculator.

You do not have to be behind on your payments to qualify for the mortgage help programs. However, not everybody can qualify. To find out if you're eligible and to see all the details, visit FinancialStability.gov.

Note: the latest announcement will bring out plenty of scammers. You do not have to pay a fee to participate in this program. If somebody asks for a fee, they're either talking about something else or ripping you off.

Further reading:

• How Debt Workouts Work