President Obama’s “Home Owner Affordability and Stability Plan” might help as many as 9 million struggling homeowners by providing for both a refinancing and loan modification program. And, depending on your particular circumstances, you may want to contact your lender as soon as possible, since the plan went into effect on March 4.

According to an analysis done by RealtyTimes, if you have less than 20% equity in your home, and have made payments but find your home is worth less than your mortgage, the refinance plan may be best for you. You may be able to get new loans at lower interest rates provided the new note doesn’t exceed 105% of the home’s value. This refinanced mortgage will replace the old loan with a new one, and is estimated to target 4 to 5 million home owners.

On the other hand, RealtyTimes suggests if you feel you are one of 3 to 4 million “at-risk” homeowners, that is, someone with a high mortgage debt-to-income ratio and a mortgage value higher than the value of your home, a loan modification may be best for you. Loan modifications change the terms of the existing loan without writing a new one and can serve higher cost housing markets better than refinance plans. This plan may be referred to as a “workout,”and it will help anyone who hasn’t missed payments but who is at risk of missing them. Payments are modified to get down to 31% of the homeowner’s income.

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