Investopedia

Continue to Site »

Home Affordable Modification Program - HAMP

Filed Under »
Dictionary Says

Definition of 'Home Affordable Modification Program - HAMP'

A loan modification program introduced in 2009 to promote stability in the housing market. The Home Affordable Modification Program (HAMP) was aimed at helping homeowners who were devoting more than 31% their of gross income toward mortgage payments. Eligible homeowners can receive adjustments to the mortgage principal, interest rate or payments in order to get the percentage of income going to payments below 31%.
Investopedia Says

Investopedia explains 'Home Affordable Modification Program - HAMP'

The government refers to the ratio of payments to gross income as the front-end debt-to-income (DTI) ratio. Working in conjunction with mortgage lenders, the HAMP program provided incetives for banks to reduce the DTI ratio to less than or equal to 38%; the Treasury will then step in to help reduce the DTI ratio to 31% or less. Mortgage servicers received an up-front payment of $1,000 for each eligible modification they performed plus up to $1,000 per year for up to three years while borrower is in the program.

Articles Of Interest

  1.

    Mortgage Points: What's The Point?

    Learn how to pay less for your home in the long run, or save in the short run.

  2. Mortgages: How Much Can You Afford?

    Answering this means number-crunching as well as factoring in other considerations and expenses.

  3. Things To Know About The Home Modification Plan

    This program allows FHA borrowers to reduce monthly mortgage payments through negotiation with lenders.

  4. Home-Equity Loans: The Costs

    Learn the factors to consider when comparing the different programs offered by various lenders.

  5. To Rent Or Buy? The Financial Issues

    Thinking of buying a home? We look at the initial and ongoing costs as well as the so-called benefits.

  6. 6 Tips For Selling Your Home Fast

    Find out what you can do to stand out from the competition and make your home an easy sell.

  7. 5 Smart Ways To Use Your Tax Return

    This year, find out how to stretch your tax refund further to strengthen your future.

  8. Common Liabilities That Hurt Your Net Worth

    Every penny that you keep out of the liability side of the net worth equation essentially ends up on the asset side.

  9. The Dangers Of A Reverse Mortgage

    In many circumstances, a reverse mortgage can be a risk to your financial security. Here are six dangers you should consider before signing on the bottom line.

  10. Automatic Cancellation Of PMI When You're Underwater On Your Mortgage

    You might be suprised to learn that after reaching certain criteria, your PMI will be automatically cancelled.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Cost-Push Inflation

    A phenomenon in which the general price levels rise (inflation) due to increases in the cost of wages and raw materials.

  2. Happiness Economics

    The formal academic study of the relationship between individual satisfaction and economic issues, such as employment and wealth.

  3. Affluenza

    A social condition arising from the desire to be more wealthy, successful or to "keep up with the Joneses." Affluenza is symptomatic of a culture that holds up financial success as one of the highest achievements.

  4. Icarus Factor

    The term Icarus factor describes a situation where managers or executives initiate an overly ambitious project which then fails. Fueled by excitement for the project, the executives are unable to reign in their misguided enthusiasm before it is too late to avoid the failure.

  5. Angelina Jolie Stock Index

    An index made up of a selection of stocks from companies associated with actress Angela Jolie.

  6. Consequential Loss

    The amount of loss incurred as a result of being unable to use business property or equipment.
Trading Center