Foreclosure rates have been on the rise for many years, and the reason for this increase across the nation is our inability to pay higher mortgages. Because of the creative lending policy of mortgage companies, and the popularity of "Sub-Prime" loans, many homeowners received loans that they could barely afford. So the question is; how did our mortgages rise from a level we were barely able to afford, to a mortgage that was out of our budget?

The number one cause is the Adjustable Rate Mortgages (ARMs). The majority of the loans created by lending institutions came in the form of ARMs, so after a period of time, the interest rate adjusted to a higher rate the homeowner couldn’t afford. This is the main reason so many home applicants were approved for loans they could not afford, and the reason so many homes are being foreclosed on. The ARM starts with a low interest rate, and after a specific period of time it is adjusted to a higher rate, so the new adjusted rate increases the monthly mortgage.

Every one of us will endure a hardship in our lives, and there are a variety of hardships we will face in today’s economic environment that will affect us financially. These can include the temporary loss of employment, the death of a spouse, or a medical emergency. And, all of these hardships could affect our income, and thus our ability to maintain our current mortgage payments.

Because of the rise in foreclosures rates, which causes housing prices to decrease, we have developed another dilemma, the" Upside-down Mortgage." This is when the current mortgage is more than the estimated market value of the property, and this situation is beyond our control because it is due to the crisis in the real estate markets. Traditionally most homeowners in a good real estate market that were facing a rate adjustment could refinance the home for a lower fixed rate, based on their record of steadily maintaining their monthly mortgage.

These are the reasons most homeowners are losing their homes to foreclosure, but the best alternative is what is called a "Loan Modification." These modifications are a hot topic all over the Internet, but for a free program that successfully teaches you how to complete a loan modification visit http://www.hureonconsulting.com. The odd fact about getting a loan modification is that, these same reasons that caused the rise in foreclosures are the reasons you can qualify for a loan modification.

The current administration has enacted legislation to help homeowners keep their home, and stem the increase in foreclosures. The largest of these legislative acts is the presidents "Home Loan Initiative Act," which allow us to modify our current mortgages to a level we can afford. This act, otherwise known as "Obama’s Loan Modification Program," requires that lending institutions and mortgage brokers work with homeowners to apply for, and accept loan modifications instead of letting their homes go into foreclosure.

The process of modifying a loan is quite straightforward, you have to show how increased interest rates, or a financial hardship has affected your ability to pay your mortgage. And then you have to demonstrate that after a loan modification how you would be able to afford the new modified mortgage. These loan modifications can be accomplished by any homeowner facing financial difficulties paying for higher adjusted mortgages, and every lending institution has a department that deals specifically with these issues, known as the "Loss Mitigation Department."

There is no reason any of us should be the victim of a potential foreclosure and loss of our home with the resources available to us. Understanding what a "Loan Modification" is and what lending institutions and mortgage brokers are looking for in their modification packages is the first step. I advise that you get more information about qualifying for a loan modification before it’s too late, and visit the website cited above for free programs that may save your home.