How to Calculate Your HAMP

HAMP stands for Home Affordable Modification Program, introduced by the US President Barack Obama administration to help people catch up with their home mortgage payment. This program is meant for people who have fallen back in the payments or are on the verge of falling back, due to higher mortgage payments and lower income. This is exactly what happened and triggered the world economic recession.

The crux of the program is to allow mortgage servicers to modify and reschedule payment in a such way that they total payment of loan comprises less than 31 per cent of the home loan payer. A home loan payer’s eligibility depends on the total payment made against the loan. The basic purpose is to help revive the housing sector, which has been hit by defaults and foreclosures because of non-payment of mortgages by the home loan borrowers. They are simply unable to pay back because of higher rate and payments level, more than they are earning. If you are a home owner and have to pay back loan to your bank, you can calculate if you qualify for HAMP.


  • 1

    Calculate Current Payment

    First step is to calculate your current mortgage payment. This includes the principal amount that you have borrowed from your bank and interest rate levied on it.

  • 2

    Take Out Monthly Payment

    You can then divide your total property tax bill by 12 to know how much you owe in the tax on a month basis, and then add the monthly payment average to your principal mortgage loan, including interest.

  • 3

    Add Insurance Premiums

    If you are paying any premiums on the property tax to homeowners, insurance cover, flood insurance premiums or have any other such expense, add the monthly total to your mortgage total with interest payment.

  • 4

    Add Association Fee, Escrow Shortage

    In addition if your are paying any association fee or aware of any monthly Escrow shortage add the sum to total mortgage principal amount, again including the interest payment, and this will make your total mortgage payment, and you can know if you qualify for HAMP.

  • 5

    Including All Other Payments

    You must be aware of any other tax or fee payment that you have been paying on a regularly basis, and add it up to the total mortgage payment. This will help you determine if you qualify for HAMP, which you can be denied by missing on such payments. Also try to be regular in your mortgage payment, even if you are in crisis, you can be on risk of default or foreclosure.

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