HUD that homeowners can use to make their mortgage current and avoid foreclosure. The HUD partial claim program pays the homeowner’s past-due mortgage payments to the lender to avoid foreclosure. The funds come from FHA mortgage premiums. Partial claims are secured by HUD through zero-interest promissory notes. A promissory note is a written promise to pay back a debt. A partial claim can pay up to 30% of your existing mortgage’s unpaid principal balance. If you sell or refinance your house after a partial claim is granted, you’ll be required to repay the partial claim. ELIGIBILITY REQUIREMENTS FOR PARTIAL CLAIM LOANS A partial claim loan is only available for consumers who can't resume making their existing monthly mortgage payments. Mortgage servicers can evaluate borrowers for a standalone partial claim. To be eligible for a partial claim the borrower- homeowner must: • Be between 4-12 months behind on their mortgage payment. • Show they have enough income to make their regular monthly mortgage payments. • Live in the property (owner-occupied). So it’s a good idea to contact your lender to discuss your delinquent mortgage payments. If you don’t ask your lender what options you have, you could lose your property. You should also know that HUD can advance your lender up to 12 months of mortgage payments (including the principal, interest, taxes, and insurance) through the partial claim program. It’s important to get all of your financial paperwork together, including proof of your income, a financial hardship budget, debts, and bank statements to show your lender. This will give
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