HAMP to help unemployed, 'underwater'

Loan mod program changes add short-sale incentives

The Obama administration today announced changes to the Home Affordable Modification Program targeted at helping unemployed and "underwater" homeowners, two groups critics of the program have said haven’t been getting help.

HAMP loan servicers will be required to provide three to six months of forbearance to eligible homeowners who lose their jobs, reducing their mortgage payments to a level that doesn’t exceed 31 percent of their monthly income.

Some homeowners who owe more than their homes are worth will also be able to refinance into loans guaranteed by the Federal Housing Administration, if lenders agree to write down at least 10 percent of their principal and bring the borrower’s combined loan-to-value ratio down to 115 percent or less.