Over the last few months, several new government programs have been created to help homeowners who have fallen behind on their mortgage payments — with some already on the verge of foreclosure. But help has not been universal, and certain mortgage- relief programs have been limited to some homeowners. And while the Federal Deposit Insurance Corporation (FDIC) and the Bush administration are currently considering the addition of some new options, the details of these plans have yet to be approved by the FDIC.

Nevertheless, this is a problem many leaders in Congress feel that quick passage is needed. They also agree that it is not prudent to wait on relief implementation until after President- elect Barack Obama is sworn in this January. Here is a summary of a few of the assistance programs currently in place:

Hope for homeowners
The Hope for Homeowners Program is geared for those whose mortgage balances exceed their home's current market value. This $300 billion program will refinance defaulting loans into new, competitive-rate, 30-year fixed rate home loans insured by the Federal Housing Administration (FHA).

The new mortgage cannot exceed 90 percent of a home's new market value as appraised, and lenders will likely have to write down a portion of the outstanding debt. Participation by the lenders is strictly voluntary, and the new mortgage amount cannot exceed $550,440. Some lenders may choose not to write down loans, preferring instead to renegotiate the old loan's rate of interest, while keeping the outstanding balance the same.

Another potential snag is that many defaulting borrowers also have high-rate piggyback loans. These piggyback loans were a popular loan product a couple of years ago for borrowers who had little down payment, but didn't want to purchase costly private mortgage insurance (PMI) which is required for those with less than 20 percent down payment. These types of loans are rarely available today.

The lender on the piggyback mortgage, often a different financial institution, will have to release their lien on the property in order for the buyer to qualify for the new loan. And more importantly, the homeowner would have to agree to share a portion of future home appreciation with the government, subject to certain new guidelines when they later decide to sell. The program is effective from October 1, 2008 to September 30, 2011.

FHA secure
The FHA Secure program, which was introduced about a year ago, offers distressed homeowners either current or delinquent on their non-FHA adjustable rate mortgage, a new, competitive fixed-rate FHA loan. The amount of the loan depends on the borrower's specific financial situation, as well as the market value of their home.

This program is due to end December 31 2008, but may be extended. It may also be expanded to those with fixed-rate loans, not just adjustable-rate loans. Check out the FHA/HUD Web site for more info on this program.

HOPE NOW
The HOPE NOW initiative represents a public-private partnership of mortgage servicers, housing counselors, and investors who assist distressed borrowers who have not been successful, or are reluctant to talk directly to their lenders. Callers to a 24/7 hotline — 888-995-HOPE — receive help in communicating with their mortgage company or are directed to a special housing counselor. Many states and municipalities also have homeowner assistance programs as well. Check the Internet for your location.

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