Home Stimulus Plan - What Are the Income Requirements?

President Obama has signed a Home Stimulus Plan that is targeted to helping homeowners avoid foreclosure and save their homes. If you are over your head in your home mortgage loan, you might wonder what the income requirements are for this federal program.

The standard loan requirements for most bank mortgages are based strictly on an income to debt ratio. This program is structured a little differently, but basically the same principal. You will have two separate income qualifications to meet. You must convince the bank with facts and documentation that you qualify.

Initially your goal is to prove to the bank that you have experienced financial hardship. This doesn't just mean that you overspent at Christmas last year on your credit card! Financial hardship means that something occurred in your life that you had no control over and this event either lowered your income or raised your expenses. Some good examples of this would be: job loss, divorce, death of a spouse, medical bills, military service, etc... You must provide documentation and proof of every fact and figure you present to prove financial hardship. This involves pay stubs, expense records and receipts, medical bills, proof of income change, divorce paperwork, and whatever else you may need.

The flip side of the income requirements is that you also must convince your lender that you can comfortably and reliably afford the new, modified payment that you receive with the loan modification. You must present proof that you have reliable income and that you have the commitment to pay the mortgage in the future. Again, all facts that are presented must be verified with the appropriate documentation.

Of course, there are other requirements for receiving a loan modification under the Home Stimulus Plan, but this is the basic income presentation you have to make. The deadline to obtain a loan modification under this program is December 31, 2012.

To get help right away, click here for more information about the home stimulus package