If you are facing a foreclosure on your home, you may go for loan modification. You will have to approach a loan modification expert and discuss the options available for this purpose.
Consult someone who can guide you
You may visit a government approved loan modification consultant who will go through your financial statements and advice you on the options available to you. They provide these services at little to no cost. They will also notify you of all the documents that will be required for the process.
Approach the mortgage company
The actual approval of the modification rest in the hands of the mortgage company. They are obliged to go through your application but the final decision rests in their hands.
Be prepared for questions and interview
Every loan application has an approval process for loan modification mitigation. The lender will ask you about your current financial status. Your income, expenses, debts and assets will be studied and your future ability for mortgage payment will be considered. You will be asked to present your financial statements, tax return and documents related to your home and mortgage.
After your application has been received, the company will check it out. Various factors, such as your income and housing costs, the condition and value of the property and the programs for which your loan is eligible will be considered. The company may reject or approve the application. The process will take some time and effort; so, be patient.
Trial Loan Modification
After completion of the application process, the loan modification inspector will take a decision on it. If they approve your application, you will get a trial loan modification. The trial modification lasts for about three months. You will be required to pay the decided amounts during this period.
If all your mortgage payments are paid by the due date during trial period and your financial circumstances are still the same, you will be considered for a final approval at the end of the trial period. It may take the mortgage company a few months to decide on the final approval. They may decide to approve or decline your application. Once approved, you will just need to sign the documents and your loan will be modified.
Looming foreclosure can be quite overwhelming for a homeowner and they may not know what to do or where to start from. If you are in such a situation, just follow the steps mentioned below.
The first step is getting help. Find a person who specializesin loan modification services and foreclosures. There are numerous government approved housing counsellors. Find one and consult themto save your home.
Strive for the best deal
Loan modification requires negotiation where the lender has the decision-making power. If you don’t think you have the best deal, hire aloan modification lawyer, or meet a person who has gone through the process of loan modification. Ask around and you will get an idea of what you should expect.
Get all your documents in order
You will be asked for your financial and tax return statements as well as payslips. Keep all the documents related to your mortgage and your property close by. Be prepared for a loan modification inspection and have a genuine reason ready for coming short on mortgage payments.
Be patient since the process will take time
The modification process is a time-consuming process. There are lots of other applicants the lender will have to look intothoroughly beforeyour application. The market where the property is located will be studied and any property sales and their value near your property will be considered. Don’t expect approval overnight and don’t be frustrated by the process.
Be up to date with the governmentpolicies
The U.S. Treasury Department and HUD release and administer various foreclosure and reduction programs. Keep yourself up to date with all these programs. The complete list of loan modification options can be found in the department’s website.
What to expect from loan modification?
Though every bank or lender is obliged to consider your loan application, they are not obliged to approve it. The final decision is totally up to them. Many appliers set up their expectations too high and are disappointed about the deals they are offered with. Have realistic expectations and get a counsel on what to expect.
A number of misunderstandings exist among people when it comes to loan modification mitigation. Let us bust a few of those myths.
To be eligible for loan modifications, you must be lagging on your mortgage payments.
Before 2009, there was a solid basis for this belief as most banks would not accept that an individual was going through tough financial times unless the individual was far behind on making his payments. But after the passing of Making Home Affordable plan by the U.S. government, the process is helping people who are current with their payments but are not financially sound.
The lender is obliged to modify your loan if you are eligible as per the government criteria.
Under no circumstance a mortgage company or lender is obliged to modify a person’s loans. The government just lists down some criteria for an individual to be considered for the loan modification options. The final decision for approval of an application completely depends on the lender.
For a loan modification, I need a loan backed by FannieMae or Freddiemac.
The government has two types of loan programs. Some of these target loan modifications while others target refinancing. If an individual is going for one of the loan modification programs, their loan need not be backed by any corporate lenders. However, if one is applying for a refinance program then the above requirement applies. See a loan modification expert to know which program is best suited to you.
If a loan modification is approved, it will reduce the principal amount.
When a loan is modified, the lender will primarily make changes to reduce the monthly mortgage payment. This reduction may be for a limited time or it may require you to deposit a lump sum payment at some point in the future. Reduction of the principal amount is extremely rare and should not be expected when applying for the process.
Approval of a loan modification depends solely on the income of the applicant.
When processing an applicant’s lone, the loan modification inspectorwill take into consideration multiple factors, such as the total income of the household including that of the spouse and children if working. Besides other assets, the current value of the property and the market scenario will also be taken into consideration.
If I apply for a loan modification or bankruptcy, the foreclosure of my home may be averted.
Any application for a loan modification doesn’t necessarily affect foreclosure sale. Act as soon as you receive notice of foreclosure. Get professional help to find out your options. Loan modification is a long process and will take time.
It is the duty of banks to help an applicant.
Banks are business institutions after all and to be in business, they must cut their losses. For every application the bank receives, both the individual’s financial condition and the banks losses are taken into consideration while processing an application. The final decision is up to the bank or the mortgage company.
If you are facing foreclosure and are confused about what to do, you need toget professional help. Keep the following things in mind:
Make sure the mortgage company listens to you
When you have a loan modification attorney representing you, the mortgage company will listen to you. So, it is handy to have someone with experience by your side. Having a legal counsellor by your side gives you an advantage, as they can leverage legal information to your best advantage.
Get the best negotiation
Loan modification is basically a negotiation between the bank’sloan modification inspectorand the homeowner. An attorney can negotiate in the right way, as they will have legal documents backing them along with the right techniques. Your negotiation will be presented from a legal point ofview. The mortgage company is bound to respond fairly to a person who is knowledgeable about the field and you are more likely to get a better deal.
Choosing the right representation
There are several options in the market for people seeking representation for their loan modification. There are several loan modification companies in the market that promise a sure shot approval of the loan modifications to their clients. Keep in mind that the ultimate decision is with the mortgage company and these third parties have no control over it. Be aware of overenthusiastic people. Generally, the target is to convince the mortgage company to lower the interest rates and amount of monthly payments.
Whenever choosing a representation, make sure that they know the laws related to the subject, the right negotiation techniques and have plenty of experience backing them. Make sure the attorney has a good record of accomplishment and is popular with all the major mortgage companies.
Moreover, a loan modification lawyer can help you with delaying a foreclosure as well as save your time.
Loan Modification & FHA:
The term “Loan Modification” explains an extension in repayment terms, period and process executed by the lender (bank, private lender & other lending authorities) against the insecurity or doubts about the borrower’s failing to repay the loan. FHA (Federal Housing Administration) makes the repayment of lenders secure against the threats of borrower’s default. The borrowers have to pay for the mortgage insurance by getting FHA loans andthis insurance protects the lending agenciesfrom the losses by defaulting of borrowers. Only the registered and authorized loan modification company can give extension in home mortgages.
Loan Modification Authority:
It is often questioned who has theactual authority to modify home loans. A loan modification firmis the right company or authority that executes the loan modification process. Fundamentally, there are several similarities and the differences between aloan modification and FHA are on the grounds of the terms, policies, repayment ways and the amounts granted for the mortgage.
FHA as a Hope for Homeowners:
In fact, theHOPE for homeowners program is very famous in the USA for the average income earners as well as others to get mortgage loans for constructing and renovating their homes. FHA makes the mortgage insurance possible for the borrowers, and the lenders get complete security of repaying their mortgages from the borrowers in case of their inability to repay the debts. Definitely, a loan modification expert can help you in taking loans and getting the benefits from the FHA program.
When you make a comparison between the loan modification service and FHA home mortgage, you will know several important aspects. Initially, loan modification is available when you apply for a home loan from a lender against some securities or bank credit history. On the other hand, the FHA loan is totally different that helps people get loans for theirhomes but against the mortgage insurance which is payable by the borrowers. This mortgage insurance keeps the lenders tension-free because FHA provides them complete security for the granted debts to borrowers and it will repay their mortgage by the insurance.
Many people become homeowners with the help of mortgage loans. But many of them later find it hard to make the payments on time due to various issues. For example, they may have financial difficulties because of losing jobs or having expensive treatments.
At this time, filing for bankruptcy may seem the right thing to do. Unfortunately, many of them give up so easily rather than exploring the loan modification options available to them.
The mortgage lawyer’s role
A mortgage lawyer can play a crucial role in saving your house. The lawyer is better exposed to see what you would usually miss out when it is about making use of the available options. It is possible that your house can be saved from a foreclosure sale through a loan modification process if explored.
Mortgage lawyer can better give a way round loan modification
Although loan modification is a probable option when it comes to loan services, it is one of the most explored avenues to avoid bankruptcy if you are still under employment. With a loan modification attorney, you would have appropriate counsel on what would be suitable for your present condition.
Seeking the right loan modification service
With the loan modification option a possible solution for your problem, the next move would be finding out a good loan modification company. Loanmoddepot is one of the reputable companies that have been helping out many people to get rid of their loan modification issues for years. You may get in touch with them through their website at https://loanmoddepot.com/ for consultation on how to get off the hook of bankruptcy. You should share your problems with them so that they can work accordingly and solve your mortgage loan related issues.
Missed or late payments always create serious problems, thus it is advisable to make all mortgage payments on time. It is best to contact a loan modification lawyer in such a situation for help. Bankers and lenders always check your payment history before giving you a loan. If you have a good credit history, you will be considered as a reliable borrower.
Problems that arise when you miss mortgage payments
If you are missing mortgage payments, you will be charged a late fee of $25 -$35 which will be featured in the statement for next billing and if your late payment keeps continuing there will be more late fees. The lender may increase the interest rate, thus resetting it for a penalty.
This will increase the interest on the outstanding balance. If you make any purchases after the penalty date, you will be charged at a higher rate depending on the terms of the credit card. The first step in this situation is to contact a loan modification attorney to help you take the right steps.
How to settle the problem of late payment?
Settling the problem of late payment is not easy. The issuers will not inform the credit bureau before 30 days about the late payment, thus you can try and pay the amount before the 30-day mark. You will be lucky if the late payment is not mentioned in the report. If the late payment was an accident you can speak to the issuer to inform him about it and see if he is willing to return your late fee.
Everything depends on the discretion of the lender whether or not he will return your late fees. If you do not succeed the first time, you can try again if you have always been regular in making your payments.
If you have missed a payment, contact the issuer immediately to make the payment and see if he will waive the late fee.
Many homeowners face financial problems and thus cannot make their mortgage payments on time. Eventually, they end up with a foreclosure sale on their properties. Here are different ways to stop a foreclosure.
Learn your mortgage laws in your state
Having proper knowledge about your mortgage laws according to your state is very important to stay on top of the whole process and avoid foreclosure, since each state has different mortgage laws.
Contact your loan modification expert
It’s better to stay on your toes when it comes to avoiding foreclosure. In order to avoid any mistakes while making big decisions regarding your mortgage, contact your loan modification expert to get the best tips.
Know what options are available
Know what options are there for you in case you are facing foreclosure since there are many forms of loan modification mitigation or loss mitigation.
- Forbearance and repayment plans: The mortgage lender can give the facility of a time frame when the homeowner doesn’t need to pay mortgage payments. At the end of this period, the homeowner will have to pay back the missed payments in full or through a new payment schedule.
- Home Affordable Modification Program: This option comes from the government to help homeowners who are eligible for this program with their loan modifications.
- Deed in lieu of foreclosure: Here, you have to voluntarily hand over the property to the mortgage lender in exchange for a discharge of the debt.
- Short Sale: The homeowner can sale his house at the time of the foreclosure process if he gets any deal higher than the total value of the debt to fulfill all the contractual obligations.
These are a few but very effective options to prevent foreclosure. As long you have a loan modification attorney beside you, there’s nothing to worry about. Visit www.loanmoddepot.com for help.
Many homeowners cannot make their mortgage payments due to various financial difficulties. They start wondering whether they should bear the late fees with mortgage payments or go for short sale. Well you should continue making your mortgage payments even if you have decided to go for short sale, since you as a seller will face negative repercussions.
Why should you keep making mortgage payments when you are going for short sale?
You should be in default to go for short sale as lenders tend to act fast on the file when you are a delinquent. A loan modification expert can guide you in this regard. No lender wants to hasten about short sale if the mortgage payments are up-to-date, but sellers have to be cautions as their credit ratings will fall. They can get FHA loan if their mortgage payments are regularly made.
Do you want to go for Short Sale?
Loan modification lawyers as well as lenders will consider short sale if the borrowers are at the risk of defaulting. If the borrower is up-to-date with his mortgage payments, he deserves some benefits. He can qualify for another home loan soon after the short sale. If you have not defaulted in your mortgage payment, the drop in credit will be negligible.
You can keep the home if it cannot be sold, but if the mortgages were not paid the lender would ask for the missed payments and penalty, and may go for foreclosure. HAFA guidelines state that the lender has to be paid in full for the borrower’s credit report. If you are not able to sell the home or if the lender does not accept the offer from short sale, you can easily cancel the listing and keep the home without any liability,
In conclusion, do not stop paying mortgage for short sale.
Not everything goes your way at all times and the only way to push things through in such situations is taking severe actions. Here are some reasons why you should file a lawsuit against your lender.
Being scammed/unlawfully treated
Even if you prepare all your papers, write a legit letter of hardship, have loan modification consultation and meet all the requirements for a loan modification and then you still get rejected, you might be facing a scam. In such a case, filing a lawsuit with a good loan modification lawyer will ensure your rights to get a loan modification.
Allegations against the lender
There are many allegations that are used against the lender. Sometimes the lender will claim to lose your documents, there might be a breach in the contract from their side, your home could be wrongfully foreclosed, and many others. There is only one option here which is filing a lawsuit against the lender. With a good loan modification attorney, you will be the one in control.
It’s not a secret that homeowners are sometimes treated horribly and even neglected by many lenders or the loss mitigation departments in big banks. Even some bank employees confessed that they were actually trained to deceive homeowners and make decisions based on the banks’ interests. There is no doubt that in these cases, filing a lawsuit can make everyone aware that they’re dealing with someone who should be taken seriously. With a loan modification specialist, avoiding foreclosure could be easy.
Filing lawsuits may be a tedious task sometimes but if you want results, you have to take actions. At www.loanmoddepot.com, you will find all the help you need to recover from the financial difficulties you are going through.