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Who's qualified and how plan will work

To be eligible, homeowners must be unemployed or owe more on their homes than they are worth. And the home must be their primary residence. 

Unemployed borrowers must:
Not have missed more than three payments.
Show that they are receiving unemployment insurance.
Have a loan that originated before Jan. 1, 2009.
Have a mortgage of less than $729,750.

How the program helps them:
People receiving unemployment benefits would see their mortgage payments drop to no more than 31 percent of their monthly income -- but only for three to six months. That's intended to give homeowners more time to find a job. Once they do, they may qualify for a loan modification that could permanently reduce their payments.

"Underwater" borrowers must:
Be current on their payments.
Owe at least least 15 percent more than their house's current value.
Have a mortgage of less than $729,750.

How the program helps them:
Their mortgage companies can reduce the loan's principal, cutting the total amount owed on the mortgage. Or the homeowners can refinance into loans backed by the Federal Housing Administration, which insures loans against default.

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