The foreclosure prevention plan signed by President Barack Obama is extending help for those with second mortgages. The Obama Administration announced that the plan will cover those that have had to take out second mortgages in order to pay little or no closing costs during the time of purchase of their home. The administration hopes to draw more struggling homeowners towards the Hope for Homeowners program as well.

The $75 billion program has slowly moved towards helping homeowners. Many loan servicers have just recently began sending out letters to homeowners that they have options to fill out an application in order to try to get their loans modified. This process takes months to determine if someone qualifies. After filling out the application then the lender will look the information over and call the borrower to ask more questions. At this point they will pass on the information to the lender or finance department and determine whether or not the borrower is eligible for a modification. For those without jobs it will be very difficult to get modified and those with jobs have to fall between not making enough and making too much.

The foreclosure prevention program is adjusting guidelines by allowing those with second mortgages to be included to receive help. The program allows a borrower to get a modification to 31 percent of their pre-taxed income. The loan servicers have 75 percent of the country’s mortgages and are beginning to participate in the program whereas many weren’t before. The homeowners with little or no equity will be able to get a modification to their loan or refinanced by the lender. The foreclosure prevention is still expecting to help more than 9 million homeowners to avoid foreclosure.