| FHA Loan Programs |
Project Lifeline – Overview
• Members of the HOPE NOW Alliance are employing multiple
strategies to help prevent avoidable foreclosures and continue to
look for additional solutions to reach and help homeowners. Since
the Alliance was formed last October, servicers, non-profit
counselors and investors have launched several programs to help
homeowners struggling to make their mortgage payments.
• Today we are announcing Project Lifeline: a targeted outreach
to seriously delinquent homeowners (90 days or more late) that
currently face the greatest risk of losing their home.
Under the leadership of Secretaries Paulson and Jackson, Project
Lifeline is encouraging homeowners to reach out to their
mortgage servicer or counselor. It’s an effort to directly
“pause” the foreclosure process, where appropriate, through a
single call.
• Servicers have been aggressively reaching out to struggling
homeowners in an attempt to find a work-out solution. Given the
dynamic environment in the housing market – with declining
home values, fluctuating interest rates, elevated housing
inventory – aggressively targeting these seriously delinquent
homeowners one more time is in everyone’s best interest
(homeowners, servicers, investors and communities in which we
all live.)
• Today six HOPE NOW alliance members – Bank of America,
Chase, Citigroup, Countrywide, Washington Mutual and Wells
Fargo – are announcing the launch of Project Lifeline. These
servicers will begin the program by providing a letter to seriously
delinquent homeowners nationwide giving homeowners a simple
“step-by-step” approach that, if followed, may enable
them to “pause” their foreclosure for 30 days while a potential
loan modification is evaluated. Servicers will reach out to
homeowners on a nationwide basis – with this step-by-step
approach to finding a solution which meets their individual needs.
This is different than the “streamlined” approach to loan
modification announced previously. It is a broad, national
approach to help all homeowners individually. Subprime, Alt-A,
and prime loans may qualify for this program, including second
liens and home equity loans.
• These leading servicers – which represent approximately 50
percent of mortgages – will soon begin to reach out to
homeowners giving them a few simple steps that may qualify
them for a loan modification:
Step 1 – call your mortgage servicer.
Step 2 – tell the servicer you have received the letter, you want
to stay in your home and you are willing to seek counseling, if
necessary.
Step 3 – provide updated financial information so the servicer can
explore an appropriate solution.
Step 4 – if appropriate, any pending foreclosure may be “paused”
for up to 30 days during this review process until a formal
decision is made and, if possible, a plan is created.
Step 5 – If a workout plan is established and the homeowner
follows the plan for three consecutive months, their loan will be
formally modified as they will have demonstrated their ability to
meet the requirements.
• Hope Now will continue to work with other members of the
Alliance to further expand the reach of Project Lifeline to all
servicers.
Participants:
• Six leading servicers representing approximately 50% of the
mortgage servicing market are implementing this new program
(Bank of America, Chase, Citigroup, Countrywide, Washington
Mutual and Wells Fargo)
• These leaders have provided a blueprint the rest of the industry
can adopt in the coming weeks and months. HOPE NOW is
encouraging all of its members to adopt this new program as a
standard industry practice.
Qualifying Loans:
• All 90-day delinquent loans, including subprime, Alt-A, prime,
second liens and home equity
loans, that are not:
In active bankruptcy.
In active foreclosure with sale date less than 30 days.
Where the homeowner has indicated that they want to give up
the home.
Investment properties.
Vacant properties.
Requirements for a Loan Modification:
• Homeowners must do the following to be evaluated for a loan
modification:
Call their servicer within ten days of receiving the notice.
Tell the servicer that they have received the letter, they want to
stay in the home and they are willing to seek counseling, if
necessary. Provide updated financial information so the servicer
can explore the appropriate solution.
• If applicable, homeowners already in the foreclosure process
will have the process "paused" for up to 30 days while they are
evaluated for a loan modification.
Key Questions about Project Lifeline:
- What is new about this Program?
Today we are announcing Project Lifeline: A targeted outreach to
seriously delinquent homeowners (90 days or more late) that
currently face the greatest risk of losing their home. It’s
an effort to directly “pause” the foreclosure process through a
single call.
This is a special effort focused on reaching homeowners who are
90 days or more delinquent but who want to stay in their homes;
it seeks to let them know that their servicer is anxious to consider
them for a modification. By also offering the homeowner a
foreclosure “pause” where appropriate, the servicer is letting the
homeowner know that they’re serious about trying to find a
loan modification that works, as well as giving both parties time
to take action where a solution appears possible.
- How does this program fit into the other HOPE NOW Alliance
activities?
This is an additional program designed to reach all seriously
delinquent homeowners who want to keep their homes. While
the Fast Track program announced in December streamlines the
loan modification process only for homeowners with subprime
adjustable loans, Project Lifeline applies to any homeowner in
any type of loan product. It’s one more way that HOPE NOW is
developing solutions to help homeowners. Specifically, it is a new
program undertaken by six of the leading servicers that are part
of the HOPE NOW Alliance. It will include not only subprime, but
also Alt-A and prime loans as well. Additional HOPE NOW
servicers are encouraged to adopt the program. Keep in mind
that all HOPE NOW servicers are already actively employing
existing programs such as homeowner outreach, support of the
HOPE hotline, the HOPE NOW letter campaign, and employing the
ASF fast-track framework for subprime resetting loans.
HOPE NOW Alliance outreach activities Applicable loan type
Counseling hotline 888-995-HOPE All
Reset notification 120 days prior to reset Subprime ARMs
HOPE NOW letters (60 day – call servicer or hotline) All
ASF Fast-track refinance and loan modification Subprime ARMs
Lifeline (90 day – possible foreclosure “pause”) All
- What are these servicers committing to?
These servicers will begin by providing a letter to seriously
delinquent homeowners giving homeowners a simple "step-by-
step" approach that, if followed, may enable them to “pause”
their foreclosure for 30 days while a potential modification is
evaluated. Servicers will reach out to homeowners on a
nationwide basis – with this step-by-step approach to finding a
solution which meets their individual needs. This is a broad,
national approach to help all homeowners individually.
Key Questions about Project Lifeline (continued):
- What should homeowners do?
Homeowners should begin by calling their servicer and
expressing their interest in keeping their home; the sooner a
homeowner reaches their servicer, the more options the servicer
has in trying to find a solution. The homeowner should prepare
for the call by gathering income and expense documentation that
might be needed by the servicer to consider a potential
modification.
- Does this program guarantee a loan modification?
No, it does not guarantee a loan modification, but where
homeowners express an interest in keeping their homes,
servicers will try their best to find an appropriate modification
wherever possible.
- Is this program a foreclosure moratorium?
No, this program is not a foreclosure moratorium, but it includes a
case-by-case foreclosure “pause” where appropriate. Where
foreclosure “pauses” are applied, it is both a win for the
homeowner and the servicer, since it will be applied where the
homeowner both indicates an interest in keeping the home and
there is a reasonable prospect of finding an acceptable loan
modification.
- When will this program begin – when will letters be mailed?
Servicers will begin mailing letters to targeted homeowners as
soon as they are ready on an individual company basis. Outreach
letters will be sent in waves to homeowners beginning, for
some servicers, immediately.
- How many homeowners will this help?
Servicers are seeking to help as many homeowners as possible
through this program. The number of homeowners who are at
least 90 days delinquent is in the hundreds of thousands, so this
program could potentially have a significant impact. Ultimate
effectiveness will hinge in part on the response rate of
homeowners calling their servicers and expressing interest in
keeping their homes; since loan modifications also are done on a
case-by-case basis, it is difficult at present to
estimate a precise number of those who may be helped.
Sample Lifeline Letter:
Notice Of Possible Relief On Your Mortgage Payment
John Q. Homeowner
12345 Any Street
Anytown, US 12345-6789
Please read: Important information on what you can do to
receive payment relief on
your [Servicer Name] mortgage — Loan No. XXXXXXXX
Dear <first name> <last name>:
We’re writing to let you know that you may be eligible for
payment relief on your mortgage. This
program offers the assistance you need to remain in your home.
How The Program Can Help You
You are being considered for a loan modification, which is a
change to the original terms of your
mortgage contract. If you qualify, this could reduce your interest
rate, or extend the time you have to
repay your loan, or both. This means it could reduce your monthly
payments and help you stay in
your home.
To Get Help, Call Us Now
To help us determine if you qualify for assistance, you must call
us by <month XX, XXXX> at 1-
800-XXX-XXXX. When you call, be sure to tell us you received this
letter, that you want to
participate in the program and remain in your home. We’ll also
need your financial information,
including income and expenses, so be sure to have it handy
when you call.
What Happens Next
If you qualify, we can help. [Servicer Name] may provide you with
budget counseling at an approved
agency at no cost to you. We’ll review your financial information
and, if applicable, suspend any
foreclosure activity for 30 days while we create a new plan for
you. After you make three payments in
the new amount, we’ll finalize your loan modification.
If We Do Not Hear From You
If you do not call us, we will not be able to help you. If you are
currently in foreclosure, the process
will continue and you may lose your home. If you are not yet in
foreclosure, that process could begin
if you are unable to make payments.
Call Now, So You Can Remain In Your Home
Don’t wait. For the help you need, call us today at 1-800-XXX-
XXXX. Our [Servicer Name]
mortgage specialists are available to help you Monday through
Friday, XX:XX a.m. to XX:XX p.m.
Sincerely,
Name
Title/Servicer Name
This is an attempt to collect a debt and any information you
provide may be used for that purpose
• Members of the HOPE NOW Alliance are employing multiple
strategies to help prevent avoidable foreclosures and continue to
look for additional solutions to reach and help homeowners. Since
the Alliance was formed last October, servicers, non-profit
counselors and investors have launched several programs to help
homeowners struggling to make their mortgage payments.
• Today we are announcing Project Lifeline: a targeted outreach
to seriously delinquent homeowners (90 days or more late) that
currently face the greatest risk of losing their home.
Under the leadership of Secretaries Paulson and Jackson, Project
Lifeline is encouraging homeowners to reach out to their
mortgage servicer or counselor. It’s an effort to directly
“pause” the foreclosure process, where appropriate, through a
single call.
• Servicers have been aggressively reaching out to struggling
homeowners in an attempt to find a work-out solution. Given the
dynamic environment in the housing market – with declining
home values, fluctuating interest rates, elevated housing
inventory – aggressively targeting these seriously delinquent
homeowners one more time is in everyone’s best interest
(homeowners, servicers, investors and communities in which we
all live.)
• Today six HOPE NOW alliance members – Bank of America,
Chase, Citigroup, Countrywide, Washington Mutual and Wells
Fargo – are announcing the launch of Project Lifeline. These
servicers will begin the program by providing a letter to seriously
delinquent homeowners nationwide giving homeowners a simple
“step-by-step” approach that, if followed, may enable
them to “pause” their foreclosure for 30 days while a potential
loan modification is evaluated. Servicers will reach out to
homeowners on a nationwide basis – with this step-by-step
approach to finding a solution which meets their individual needs.
This is different than the “streamlined” approach to loan
modification announced previously. It is a broad, national
approach to help all homeowners individually. Subprime, Alt-A,
and prime loans may qualify for this program, including second
liens and home equity loans.
• These leading servicers – which represent approximately 50
percent of mortgages – will soon begin to reach out to
homeowners giving them a few simple steps that may qualify
them for a loan modification:
Step 1 – call your mortgage servicer.
Step 2 – tell the servicer you have received the letter, you want
to stay in your home and you are willing to seek counseling, if
necessary.
Step 3 – provide updated financial information so the servicer can
explore an appropriate solution.
Step 4 – if appropriate, any pending foreclosure may be “paused”
for up to 30 days during this review process until a formal
decision is made and, if possible, a plan is created.
Step 5 – If a workout plan is established and the homeowner
follows the plan for three consecutive months, their loan will be
formally modified as they will have demonstrated their ability to
meet the requirements.
• Hope Now will continue to work with other members of the
Alliance to further expand the reach of Project Lifeline to all
servicers.
Participants:
• Six leading servicers representing approximately 50% of the
mortgage servicing market are implementing this new program
(Bank of America, Chase, Citigroup, Countrywide, Washington
Mutual and Wells Fargo)
• These leaders have provided a blueprint the rest of the industry
can adopt in the coming weeks and months. HOPE NOW is
encouraging all of its members to adopt this new program as a
standard industry practice.
Qualifying Loans:
• All 90-day delinquent loans, including subprime, Alt-A, prime,
second liens and home equity
loans, that are not:
In active bankruptcy.
In active foreclosure with sale date less than 30 days.
Where the homeowner has indicated that they want to give up
the home.
Investment properties.
Vacant properties.
Requirements for a Loan Modification:
• Homeowners must do the following to be evaluated for a loan
modification:
Call their servicer within ten days of receiving the notice.
Tell the servicer that they have received the letter, they want to
stay in the home and they are willing to seek counseling, if
necessary. Provide updated financial information so the servicer
can explore the appropriate solution.
• If applicable, homeowners already in the foreclosure process
will have the process "paused" for up to 30 days while they are
evaluated for a loan modification.
Key Questions about Project Lifeline:
- What is new about this Program?
Today we are announcing Project Lifeline: A targeted outreach to
seriously delinquent homeowners (90 days or more late) that
currently face the greatest risk of losing their home. It’s
an effort to directly “pause” the foreclosure process through a
single call.
This is a special effort focused on reaching homeowners who are
90 days or more delinquent but who want to stay in their homes;
it seeks to let them know that their servicer is anxious to consider
them for a modification. By also offering the homeowner a
foreclosure “pause” where appropriate, the servicer is letting the
homeowner know that they’re serious about trying to find a
loan modification that works, as well as giving both parties time
to take action where a solution appears possible.
- How does this program fit into the other HOPE NOW Alliance
activities?
This is an additional program designed to reach all seriously
delinquent homeowners who want to keep their homes. While
the Fast Track program announced in December streamlines the
loan modification process only for homeowners with subprime
adjustable loans, Project Lifeline applies to any homeowner in
any type of loan product. It’s one more way that HOPE NOW is
developing solutions to help homeowners. Specifically, it is a new
program undertaken by six of the leading servicers that are part
of the HOPE NOW Alliance. It will include not only subprime, but
also Alt-A and prime loans as well. Additional HOPE NOW
servicers are encouraged to adopt the program. Keep in mind
that all HOPE NOW servicers are already actively employing
existing programs such as homeowner outreach, support of the
HOPE hotline, the HOPE NOW letter campaign, and employing the
ASF fast-track framework for subprime resetting loans.
HOPE NOW Alliance outreach activities Applicable loan type
Counseling hotline 888-995-HOPE All
Reset notification 120 days prior to reset Subprime ARMs
HOPE NOW letters (60 day – call servicer or hotline) All
ASF Fast-track refinance and loan modification Subprime ARMs
Lifeline (90 day – possible foreclosure “pause”) All
- What are these servicers committing to?
These servicers will begin by providing a letter to seriously
delinquent homeowners giving homeowners a simple "step-by-
step" approach that, if followed, may enable them to “pause”
their foreclosure for 30 days while a potential modification is
evaluated. Servicers will reach out to homeowners on a
nationwide basis – with this step-by-step approach to finding a
solution which meets their individual needs. This is a broad,
national approach to help all homeowners individually.
Key Questions about Project Lifeline (continued):
- What should homeowners do?
Homeowners should begin by calling their servicer and
expressing their interest in keeping their home; the sooner a
homeowner reaches their servicer, the more options the servicer
has in trying to find a solution. The homeowner should prepare
for the call by gathering income and expense documentation that
might be needed by the servicer to consider a potential
modification.
- Does this program guarantee a loan modification?
No, it does not guarantee a loan modification, but where
homeowners express an interest in keeping their homes,
servicers will try their best to find an appropriate modification
wherever possible.
- Is this program a foreclosure moratorium?
No, this program is not a foreclosure moratorium, but it includes a
case-by-case foreclosure “pause” where appropriate. Where
foreclosure “pauses” are applied, it is both a win for the
homeowner and the servicer, since it will be applied where the
homeowner both indicates an interest in keeping the home and
there is a reasonable prospect of finding an acceptable loan
modification.
- When will this program begin – when will letters be mailed?
Servicers will begin mailing letters to targeted homeowners as
soon as they are ready on an individual company basis. Outreach
letters will be sent in waves to homeowners beginning, for
some servicers, immediately.
- How many homeowners will this help?
Servicers are seeking to help as many homeowners as possible
through this program. The number of homeowners who are at
least 90 days delinquent is in the hundreds of thousands, so this
program could potentially have a significant impact. Ultimate
effectiveness will hinge in part on the response rate of
homeowners calling their servicers and expressing interest in
keeping their homes; since loan modifications also are done on a
case-by-case basis, it is difficult at present to
estimate a precise number of those who may be helped.
Sample Lifeline Letter:
Notice Of Possible Relief On Your Mortgage Payment
John Q. Homeowner
12345 Any Street
Anytown, US 12345-6789
Please read: Important information on what you can do to
receive payment relief on
your [Servicer Name] mortgage — Loan No. XXXXXXXX
Dear <first name> <last name>:
We’re writing to let you know that you may be eligible for
payment relief on your mortgage. This
program offers the assistance you need to remain in your home.
How The Program Can Help You
You are being considered for a loan modification, which is a
change to the original terms of your
mortgage contract. If you qualify, this could reduce your interest
rate, or extend the time you have to
repay your loan, or both. This means it could reduce your monthly
payments and help you stay in
your home.
To Get Help, Call Us Now
To help us determine if you qualify for assistance, you must call
us by <month XX, XXXX> at 1-
800-XXX-XXXX. When you call, be sure to tell us you received this
letter, that you want to
participate in the program and remain in your home. We’ll also
need your financial information,
including income and expenses, so be sure to have it handy
when you call.
What Happens Next
If you qualify, we can help. [Servicer Name] may provide you with
budget counseling at an approved
agency at no cost to you. We’ll review your financial information
and, if applicable, suspend any
foreclosure activity for 30 days while we create a new plan for
you. After you make three payments in
the new amount, we’ll finalize your loan modification.
If We Do Not Hear From You
If you do not call us, we will not be able to help you. If you are
currently in foreclosure, the process
will continue and you may lose your home. If you are not yet in
foreclosure, that process could begin
if you are unable to make payments.
Call Now, So You Can Remain In Your Home
Don’t wait. For the help you need, call us today at 1-800-XXX-
XXXX. Our [Servicer Name]
mortgage specialists are available to help you Monday through
Friday, XX:XX a.m. to XX:XX p.m.
Sincerely,
Name
Title/Servicer Name
This is an attempt to collect a debt and any information you
provide may be used for that purpose
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