HARP

• According to the U.S. Department of Housing and Urban Development (HUD) and the U.S. Treasury, the Home Affordable Refinance Program (HARP) helps borrowers save more than $500 each month on their mortgage payments through government-sponsored refinancing. Individuals with a Fannie Mae- or Freddie Mac-guaranteed or -owned loan can refinance their mortgage with a new lower interest rate if they are current on their mortgage payments, owe more than their home is worth and have a job that pays enough to make the new lower monthly payments. Individuals can apply with any company that deals in mortgages guaranteed by Fannie Mae and Freddie Mac.
  
  

Principle Reduction

• The Principal Reduction Alternative (PRA) allows homeowners to eliminate part of their mortgage principle if they owe more on their home than the assessed value of their property. According to the U.S. Department of HUD, homeowners must also have a mortgage payment that exceeds 31 percent of their gross monthly income, and the loan cannot be guaranteed or owned by Fannie Mae or Freddie Mac. Homeowners can participate in the PRA through over a hundred participating lenders, including large lending institutions such as Bank of America and JPMorgan Chase.
  
  

FHA Refinance

• The Federal Housing Administration helps homeowners reduce the size of their monthly loan payments by lowering the size of their home loan. With this program, the lender will lower the amount owed on a home loan to not more than 97.75 percent of the assessed value. In order to qualify, participants cannot have a mortgage owned or backed by Fannie Mae, Freddie Mac, the FHA, the VA or the USDA and must owe more on their home note than the assessed value of their property. In addition, total debt cannot exceed 55 percent of monthly gross income, and the owner must occupy the property. Mortgage servicers can choose to participate in this program voluntarily for tax benefits, so homeowners should call their local bank and ask about this alternative.
  
  

Local

• Some states in the United States have created programs in order to help homeowners pay their mortgage payments. The CT Families program helps low- and middle-income Connecticut borrowers refinance their home loans, while the Delaware Emergency Mortgage Assistance Program offers homeowners temporary loans with a low interest rate in order to prevent foreclosure. According to the National Governors Association, Illinois, Maryland, Massachusetts, Michigan, Montana, New Hampshire, New Jersey, New York, North Carolina and Pennsylvania all offer mortgage assistance programs. Residents should call their state housing authority to find out what mortgage assistance programs are available in their state.