The Obama mortgage program is no longer available. The Home Affordable Modification Program (HAMP) stopped accepting applications on December 30, 2016, and the Home Affordable Refinance Program (HARP) expired on December 31, 2018.1Federal Housing Finance Agency. FHFA Announces Extension of HARP Together, the two programs produced roughly 1.7 million permanent loan modifications during and after the housing crisis.2U.S. Department of the Treasury. HAMP Modification Performance Summary If you’re struggling with your mortgage now, comparable federal help still exists. Where you look depends on who owns or backs your loan.
What Ended and What Took Its Place
HAMP was the centerpiece of the Making Home Affordable initiative. Servicers followed a set sequence to bring a borrower’s housing payment down to 31% of gross monthly income: lower the interest rate to a floor of 2%, extend the loan term up to 40 years, then defer part of the principal interest-free.3Freddie Mac. Seasoned Loan Offerings – Modification Programs HARP addressed a different problem, letting homeowners who were current on payments refinance even when they owed more than their home was worth.4U.S. Department of the Treasury. Making Home Affordable
Both are closed. Neither accepts new applications, and no extension is on the table. The framework they created, though, shaped what came next. If your mortgage payment has become unaffordable today, the successor programs use the same basic idea of stepping through modifications until the payment reaches an affordable level.
Flex Modification for Fannie Mae and Freddie Mac Loans
The Flex Modification replaced HAMP as the main loss mitigation option for loans owned by Fannie Mae or Freddie Mac. The servicer capitalizes missed payments into the loan balance, sets a new fixed interest rate, extends the remaining term up to 480 months from the modification date, and forbears a portion of principal if needed. The target is a 20% reduction in the borrower’s principal and interest payment.5Fannie Mae. Flex Modification
Not every modification hits that 20% mark. The servicer works through each step in order and stops when either the target is reached or the steps are exhausted.5Fannie Mae. Flex Modification You don’t need to know in advance whether Fannie Mae or Freddie Mac owns your loan. Your servicer is required to check and evaluate you for the option that applies.
FHA, VA, and USDA Options
If your mortgage is insured or guaranteed by a federal agency, a different set of programs applies. Each agency runs its own sequence, and your servicer must work through the options in order.
FHA-Insured Loans
FHA carries one of the most detailed loss mitigation menus. Your servicer must evaluate you for each option in a specific order before moving to the next:
- Repayment plan, which spreads overdue payments across several months on top of the regular payment.
- Forbearance, which temporarily pauses or reduces the monthly payment.
- Standalone partial claim, which moves the past-due amount into a separate, interest-free lien you don’t repay until you sell, refinance, pay off the mortgage, or transfer title.
- Loan modification, which permanently changes your mortgage terms by rolling missed payments into the balance and extending the loan at a fixed rate.
- Combination modification and partial claim, which uses both tools together.
- Payment supplement, which uses a partial claim to cover arrears and temporarily reduce the monthly payment for three years.
FHA limits you to one permanent retention option within any 24-month period, unless a presidentially declared disaster affects you. A pre-foreclosure sale (short sale) or a deed-in-lieu of foreclosure remains available as a last resort.6U.S. Department of Housing and Urban Development. FHA Loss Mitigation Program
VA-Guaranteed Loans
Veterans and surviving spouses with VA-backed mortgages can access a VA Partial Claim, where the VA purchases part of the loan’s delinquent amount and holds it as a subordinate lien. To qualify, you must be at least three full months behind, live in the property as your primary residence, and have made at least 12 payments since origination (or six since a prior modification). The servicer must first offer a trial payment plan, and the past-due amount generally cannot exceed 25% to 30% of the unpaid principal balance depending on whether the default is tied to the COVID-19 pandemic period.7Department of Veterans Affairs. VA Servicer Handbook M26-4 Chapter 22 – VA Partial Claims
USDA Rural Development Loans
USDA-guaranteed loans follow their own sequence: repayment agreement, forbearance agreement, standard modification (up to 30 years), extended-term modification (up to 40 years), and finally a mortgage recovery advance if nothing else produces an affordable payment. No minimum credit score or home appraisal is required. You must occupy the property as your primary residence and show you can handle the modified payment. A three-month trial period applies, or four months if you haven’t yet missed a payment, before the modification becomes permanent.8USDA Rural Development. Special Loan Servicing Job Aid
The Homeowner Assistance Fund Is Closing
The American Rescue Plan Act created the Homeowner Assistance Fund with $9.961 billion to help homeowners who fell behind because of COVID-19. Unlike a loan modification, HAF pays direct financial assistance toward delinquent mortgage payments, property taxes, insurance, and utilities. Every state, territory, and tribe received an allocation and runs its own application process.9U.S. Department of the Treasury. Homeowner Assistance Fund10Consumer Financial Protection Bureau. Get Homeowner Assistance Fund Help
The fund is winding down. Treasury has published closeout guidance with a September 30, 2026 deadline, and many state programs have already exhausted their allocations or closed to new applicants.9U.S. Department of the Treasury. Homeowner Assistance Fund If you haven’t applied, check your state’s HAF program now. Funding that’s gone is gone.
How to Apply
Whatever loan you have, the process starts by calling your mortgage servicer and asking for the loss mitigation department. Ask specifically for that department rather than general customer service. The servicer will send you an application package. You’ll typically need to provide proof of income (pay stubs, tax returns, benefit statements), a list of monthly expenses and debts, and a written explanation of your hardship. Most servicers also require IRS Form 4506-C, which authorizes them to pull your tax transcripts directly from the IRS to verify what you’ve reported.11Internal Revenue Service. Form 4506-C – IVES Request for Transcript of Tax Return
Submit the complete package through whatever secure channel the servicer offers, whether an online portal, fax, or certified mail. Keep copies of everything. Most applications stall on a missing document or an unclear hardship letter, which gives the servicer a reason to ask for more information and reset the clock.
If you inherited a home with an existing mortgage, or became the sole owner through a divorce, federal regulations protect your right to apply. Once the servicer confirms your identity and ownership, you’re considered a “successor in interest” and must be treated the same as the original borrower for purposes of loss mitigation.12Consumer Financial Protection Bureau. 12 CFR 1024.31 – Definitions
Free help is available through HUD-approved housing counseling agencies. A counselor can review your finances, help you assemble your application, and communicate with your servicer on your behalf. You can find one through the Consumer Financial Protection Bureau’s counselor search tool.13Consumer Financial Protection Bureau. Find a Housing Counselor
Protections Once You Apply
Federal Regulation X gives you concrete rights once you submit a loss mitigation application. Your servicer must acknowledge receipt in writing within five business days and tell you whether the application is complete or what’s still missing.14eCFR. 12 CFR 1024.41 – Loss Mitigation Procedures Once the servicer has a complete application received more than 37 days before any scheduled foreclosure sale, it must evaluate you for every available option and send a written decision within 30 days.15Consumer Financial Protection Bureau. 12 CFR 1024.41 – Loss Mitigation Procedures
The most important protection is the ban on “dual tracking.” A servicer that has your complete application more than 37 days before a foreclosure sale cannot move forward with the sale until it has finished evaluating you and you’ve had time to respond.14eCFR. 12 CFR 1024.41 – Loss Mitigation Procedures The key word is “complete.” An incomplete application doesn’t trigger these protections, which is why submitting every requested document matters.
If your modification request is denied, you have the right to appeal. You can also file a formal notice of error if the servicer mishandled your application, failed to evaluate you for all available options, or gave inaccurate information about foreclosure alternatives. If the servicer designates a specific address for these notices, that address must be posted on its website.16Consumer Financial Protection Bureau. 12 CFR 1024.35 – Error Resolution Procedures
Watch for Scams
Federal law makes it illegal for any company to charge you a fee for mortgage modification services before it has obtained a modification offer from your lender and you’ve accepted it in writing.17eCFR. 12 CFR Part 1015 – Mortgage Assistance Relief Services (Regulation O) Anyone asking for money upfront is breaking the law.
The Federal Trade Commission flags several other warning signs:18Federal Trade Commission. Mortgage Relief Scams
- Being told to stop talking to your lender. You always have the right to speak with your servicer directly.
- Being asked to transfer your deed. No legitimate modification requires signing your home over to a third party.
- Being told to pay by wire or mobile app. Scammers prefer payment methods you can’t reverse.
- Being sold a “forensic loan audit.” These rarely produce anything useful, and the results don’t obligate your lender to modify the loan.
HUD-approved counselors provide the same guidance a paid company would claim to offer, at no cost. There’s no reason to pay for help the government provides for free.