Equity News

A Closer Look at Government Debt Relief Grants

Almost every day we hear in the news and read in the newspapers about government debt relief and grants. Several questions raise in our minds like what are they? Do they really exist? What the government can actually do to provide debt relief? Or can they be explained in layman terms and not with daunting jargons and terminology? The answer is yes, of course, it can be done. There are a variety of government aided programs available that assist low-income families to afford necessities. However don’t expect an overnight change in your credit card debt as government hardly provides any direct help to mitigate your credit card bills. Read on to have a look at the viable options which government offers to help you to deal with your debts in a better way.

Student Loan Consolidation

If you or your parents grapple with ways to pay back your multiple federal student loans, federal student loan consolidation can be an answer to your worries. This certainly helps you to amalgamate your loans into one that has a lower interest rate and one convenient monthly payment. However, remember, this form of debt relief is only applicable for  federal student loans, private student loans cant be consolidated under this program.

Mortgage Debt Relief

The area where government aids are truly commendable is in the realm of mortgage debt and impending foreclosure.  Recently Due to the sub prime mortgage meltdown, the U.S Department of Housing and Urban Development (HUD) offers some new programs in order to assist homeowners struggling with their mortgages.

Making Home Affordable Program (MHA)

In 2009, the Obama Administration took the initiative to create the Making Home Affordable (MHA) program which has two components: mortgage refinancing through Home Affordable Refinance Program (HARP); and mortgage modification through Home Affordable Modification Program (HAMP). Other provisions are there that also include homeowners with second mortgages (liens) or even third mortgages.

Home Affordable Modification Program (HAMP)

HAMP or Home Affordable Modification Program is designed to help homeowners who strive to evade foreclosure by modifying the loan terms. It provides absolute help to make the mortgage payments affordable for the consumers in the long-term. To qualify for this loan the borrower needs to meet certain criteria like the borrower must be delinquent on their mortgage or faces imminent risk of default, the collateral must borrower’s primary residence and the mortgage should be originated on or before Jan. 1, 2009 and unpaid principal balance must be no greater than $729,750 for one-unit properties.

All the above mentioned government funds bear witness of concern of U.S government for the debt stricken Americans and their sincere endeavors to help them out. Make sure you stay away from scam debt relief companies and make the most of the government debt relief grants.

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