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(Online-Artikel.de) - Following the standard formula which the lender use to determine the eligibility of the home affordable modification program eligibility will help the homeowners to get quick approval.

There is a standard formula which participating lenders use to decide the eligibility under the home affordable modification program. The treasury department of U.S has authorized this formula which is used while reviewing the request of the borrower for a loan. One should learn this four basic step formula to pre-qualify and have a good chance to get the proposal approved. Loansstore, a leading name in the providing services for loan modification also helps in the approval process.

The federal making home affordable program or the Home Affordable Modification Program is designed to provide a sustainable and affordable mortgage payment for the homeowners who are at risk of becoming delinquent or who are either delinquent. The basic criteria which should be met are the proof of a financial hardship conditions. This could be because of any number of circumstances, but usually the acceptable include:

• Loss of income or reduction in the income
• Change is the financial circumstances of the household
• Lack of cash reserves to pay the basic living expense, mortgage and other retirement accounts
• Increase in the expenses
• Reasons for hardships
• Excessive monthly debt payments
• Other general reasons for hardships

The general standard formula which the home affordable modification program lenders use is:

• Verifying the existing payment equals, which should be more than 31% of the monthly gross income
• New target payment which should be equal to the 31% of the gross monthly income, this can inc lude all household income
• New loan terms to reach the target payment, it's done by first reducing the interest rates to 2% than the loan term is extend to 40 years and finally the remaining principal balance is forgiven.
• Verifying the financial statement information of the homeowners whether it fits to the target payment calculation and the debt ratio.

The method by which one can assure that he has a good chance of approval is to learn the basic on how to figure the debt ration and the target payment and then tune the financial statement and make required adjustments to his budget. This all should be done before sending the proposal of home affordable refinance program to the lender.

One should take his own time to learn and prepare the application, as there is a good chance of getting approved. One should avoid making mistakes to get the approval faster.