On December 18, the Streamlined Modification Program (SMP) announced by the Federal Housing Finance Agency on November 11 went into effect. Borrowers with mortgages owned by Freddie Mac or Fannie Mae can be considered for the SMP if they (i) own and occupy the property as a primary residence, (ii) have not filed for bankruptcy, and (iii) have missed at least three payments. Under the SMP, mortgage and escrow payments can be reduced up to 38 percent of an eligible borrower's gross monthly income by one or more of the following: reducing mortgage rates, extending the mortgage term up to 40 years or forbearing part of the principal.