Exactly How Does a Loan Modification Work

There are thousands of home owners who need loan modifications but unfortunately, not everyone knows how the process works.

The Process

The first thing that a person needs to do is inform their bank and lender that they need the current loan to be modified as they are no longer able to pay the monthly instalments. The reasons need to be supported by different documentation to show that the person can no longer afford the payments. These are financial statements, proof of income and all the liabilities the person has like monthly instalments for vehicles etc. Along with these documents, there is also a hardship letter which explains in detail why the person can no longer afford to pay.

Qualifying Criteria

You need to qualify for loan modification help and the criteria are:

  • The loan had to have started before January 1, 2009
  • You need to be living in the home
  • The property must have a market value of less than $795,250

There could also be other criteria required by the lender and the bank and that is why a lot of people turn to loan modification companies like Loan Modification Depot for assistance. This is the safest way to make sure that you stand the best chance of receiving a modification to the current loan.

Bank or Lender Processing

This can take up to 3 months to be completed because that Banks and the Lenders might do their own assessments especially regarding the value of the property. Having a loan modification lawyer will make the bank or the lenders more comfortable knowing that the application is being done by a professional and you could stand a better chance of having a successful application.

Having a loan modification professional help you submit your application is the best way to help the whole process because they know which documents to provide and have a good idea which options to ask for from the bank or lender because of past experience