The Federal Government launched the " Hope for Homeowners" program to help struggling families keep their homes who are presently at risk for foreclosure. The Hope for Homeowners program will refinance mortgages for borrowers who are having difficulty making their payments, but can afford a new loan insured by HUD's Federal Housing Administration (FHA). The program began October 1, 2008 and ends September 30, 2011.

"For families struggling to keep up with their mortgage payments, this program will be another resource to refinance into a loan they can afford," said HUD Secretary Steve Preston. "FHA remains a safe and affordable alternative to the high-priced mortgage loans that threaten homeowners' ability to retain their homes. We strongly encourage borrowers to work with their lenders to determine if Hope for Homeowners is the right program for them."

The Hope for Homeowners program was authorized by the Economic and Housing Recovery Act of 2008. Since the President signed this vital legislation into law on July 30, 2008, the Hope for Homeowners Board of Directors has worked diligently to develop and implement the program as directed by Congress. The Board was charged with establishing underwriting standards to ensure borrowers, after any write-down in principal have a reasonable ability to repay the new FHA-insured mortgage.

The Hope for Homeowners program is available only to owner occupants and will offer 30-year fixed rate mortgages - so the borrower's last payment will be the same as the first payment. In many cases, to avoid what would be an even costlier foreclosure, banks will have to write down the existing mortgage to 90 percent of the new appraised value of the home.

Borrowers are encouraged to contact their lender to determine eligibility. Additional information may also be found here.

Source: US Department of Housing and Urban Development