The Making Home Affordable  (MHA) program was created to help homeowners avoid foreclosure, stabilize the country’s housing market, and improve the nation’s economy. It primarily helps people who are underwater in their mortgage (i.e. owe their original mortgage lender more than what the house is currently worth due to the housing crisis), who need a reduction in monthly mortgage payments in order to stay in their home, who could benefit from a reduction in interest rates, and who need to get out of a home all together and are looking for an alternative to foreclosure .
Note: The deadline to apply for many of these programs is December 31st, so read below to see if you may benefit from this and put it on your priority list.
Typical Requirements to be Eligible for these Programs
While you need to read through the specific eligibility requirements for each program listed below, there seem to be general requirements that apply for all. These include:
- Mortgage Date: These programs are typically for mortgages that were obtained on or before January 1, 2009.
- Proportion of Gross Income that goes toward Monthly Mortgage Payment: Your monthly mortgage payment generally must be 31% of your gross monthly income.
- A Record Free of Certain Types of Felonies: You cannot have been convicted of larceny, theft, fraud, forgery, money laundering or tax evasion in connection with mortgages or real estate transaction within the last 10 years.
Tip: Check with each program below for requirements specific to them.
Four Possible Ways the Program Helps Homeowners
The MHA website is littered with programs available to you, with some easy-to-follow questionnaires  to ensure that you are taken to the ones that are best for your situation. An outline of which programs are available is as follows:
- Reduced Interest Rate: If you are current on your home loan, then you may be eligible for a refinance that can get you a lower interest rate. Programs include FHA Short Refinance, FHA Second Lien Program (FHA2LP), Home Affordable Refinance Program (HARP), etc.
- Lower Monthly Mortgage Payment: Home Affordable Modification Program (HAMP) and Veterans’ Administration Home Affordable Modification (VAMP)  are two mortgage modification programs that could lower monthly mortgage payments. for those who obtained their mortgage on or before January 1, 2009.
- Principal Reduction: Principal Reduction Alternative (PRA) is a program available for people whose home is now worth significantly less than what they owe. Some qualifications include your mortgage being owned and guaranteed by a lender other than Fannie Mae and Freddie Mac (click here to figure out who owns and guarantees your mortgage loan ), your mortgage payment is more than 31% of your gross monthly income, you can prove that you have sufficient income to support the mortgage modification, etc. If you are unemployed, then you may be eligible for a temporary principal reduction through the Home Affordable Unemployment Program (UP) .
- Getting Out of a Home Loan without a Foreclosure: Home Affordable Foreclosure Alternatives (HAFA)  and Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets (HHF) are two programs available for people who need to get out of their home loan and wish to avoid a foreclosure situation. A short sale through HAFA completely releases you from your mortgage debt after selling the property (meaning that any money still owed to the service lender after the short sale is waived by the service lender). Note that this type of sale will still have an effect on your credit score, it will just be less than the effect a foreclosure has on your credit score.
How to Apply to these Programs
You will need to go through the questionnaires on the MHA website in order to figure out how to apply to the program specific to you. However, there are documents and forms that you will likely need to fill out during the process:
- Hardship Affidavit: The Hardship Affidavit  is a form that allows you to explain to your lender your decrease in income or your increase in expenses.
- Last Year’s Income Tax Return 
- Monthly Mortgage Statement
- Monthly Payment Statements for other Debts (such as student loans, car notes, credit cards, etc.)
- Pay Stubs and Proof of Income 
- Account Balances
- Information on any Second Mortgages and HELOCs you Possess
- Request for Mortgage Assistance Form 
Deadline and Additional Guidance
The deadline to apply to HAMP and HARP has been extended to December 31, 2013. For help from a HUD-approved housing counselor, call 888-995-HOPE (4673). This is a free service.