Loan Modification Guidelines and Considerations

Indeed, the real estate market is unpredictable. How else can anyone explain the fact that a lot of homeowners who bought during the property boom are now suffering from an uncontrollable rise in monthly payments, little to no equity, or problems with mortgage payments? In fact, a large percentage of homeowners who come to us at for assistance with a loan modification application are victims of fluctuations in the property market.

Who Can Be Considered For Loan Modification?

Not everyone struggling with their mortgage loan payment is eligible for loan modification although working with a loan modification specialist can improve the chances of your application being approved if you truly need it.

A loan modification inspection can prove that you truly deserve a revision of your loan repayment plan. Further, the loan modification inspector must be able to prove that you’re no longer capable of honoring your monthly mortgage payments.

An applicant who qualifies for a loan modification must first submit a letter of hardship detailing their unique circumstance and financial setbacks. Perhaps the borrower lost their job, lost a key member of the family, suffered a bad loan that led to an increase in their monthly mortgage making it challenging for them to keep up with their payment or went through a divorce.

The Requirements during Loan Application

Once your eligibility has been confirmed, the loan modification expert that you’re working with will ask you for certain documents including a list of your other debts and expenses, verification of your income and bank statements. A careful analysis of your total monthly pay-out versus your total monthly income will then be carried out and your existing lender may either create a new structured mortgage or sell it to a competitor lender.

You should not wait until you are served with a notice of default or possible foreclosure letter to start seeking home modification help. You will start getting panic attacks after three default payment; it’s wise to seek help on the first missed payment.