Many individuals are struggling to pay for their house mortgages and hundreds of thousands are dropping behind. The foreclosure rate has hit an all-time high. In this challenging economic climate there does not appear to be any near-term fix, either. So, the mortgage modification effort will likely continue to be an important, though temporary solution for many.

A mortgage modification is simply a modification to the original mortgage agreement. It could be an interest rate reduction. It could be a principal reduction (not likely). Since very few people relish the thought of moving Mortgage Modification is the obvious near term solution. As long as homeowners have mortgage payments modestly in line with local rents, there is very little incentive to look for a more permanent solution.

Many people believe that mortgage modification relief is really not available. And it truly seems that way, sometimes.

The HAMP loan modification program holds the most hope of any modification program. It’s simply head and shoulders above all other programs. The only problem? Qualifying isn’t always easy.

The first qualification hurtle is loan amount and loan origination date. HAMP mods require loans to be less than $729,000. They must have been made prior to January, 2009.

For more information contact a local real estate expert or real estate lawyer. Resources include Yorba Linda Homes for Sale and Rancho Santa Fe Homes For Sale.

Borrowers must show a hardship. That could be an increase in expenses, decrease in income – including reduced hours at work or job loss. Applicants do walk a tightrope however as the hardship must not be too, well, hard! Applicants must have enough document able income to make payments.

Thirdly, the borrower(s) must have sufficient income to be able to maintain the reduced mortgage payments. This calculation is done based on debt-to-income ratios and cash flows as submitted by the borrower(s) on a formal application.

All this is paid for by $75 billion from the U.S. taxpayer. Participating banks receive compensation when they grant loan mods.

Thank goodness the loan modification application process is easy. (Just a little joke)! Despite government, non-profit and other resources the application process can be brutal. One member of Congress declared it impossible for the average homeowner, after trying to help a constituent.

Article by Rancho Palos Verdes Homes for Sale. Also, a special thanks to Laguna Beach Real Estate for Market Statistic resources.