Is your house under water? If so there may be new help available for you. There are two parts to the new loan modification program released by the Treasury department yesterday. The first is a loan modification program for those why may be stuck in a higher interest rate or adjustable mortgage. To qualify for this program you must:

• Owe no more than 105% of your current home value
• Have a Freddie Mac or Fannie Mae loan
• Be current on your payments
• Be able to qualify with your current income

The biggest problem with this program in Arizona is those who may be stuck in the adjustable mortgages probably purchased their home in the last four years and are more than likely much more upside down than the 105%. If they purchased the home on a Freddie or Fannie loan, they unlikely put down more than 5% and combine that with the market trends over the last two years and it is unlikely many Arizona home owners will qualify.

The next group for the modification program is for those who:

• Payments exceed 31% of income
• Behind on payments
• Have sufficient income for a new loan rate
• Lender must agree to the modification

The government is offering $1,000 to the bank to work with you on renegotiating the loan. The question that will need to be answered here is that enough of an incentive for the banks to renegotiation the loan with the customer. Only time will tell and with the lenders having control on if they will do the renegotiating, we suggest you contact your lender.