What is a loan modification?
A negotiation with a lender to restructure the terms of a loan without refinancing, usually resulting in a lower interest rate and therefore a reduction in monthly mortgage payments.
Who qualifies for a loan modification?
A homeowner who can prove they have experienced or in the near future will be experiencing a financial hardship can qualify for a loan modification. This encompasses a homeowner that is current on their payments or anyone up to 14 days out of a sheriff sale date.
What situations qualify for a hardship?
Several cases: decline in income, increase in a mortgage payment due to the rate increasing, severe illness, divorce, incarceration, etc.
Why should I work with a loan modification company instead of doing this on my own?
Many property owners attempt to accomplish a loan modification themselves and are unsuccessful for numerous reasons, one being their unfamiliarity with what the lenders look for in granting a modification and another being patient as a typical hold time to accomplish a modification can be hours a week for numerous weeks.
Is there a fee and why do I have to pay a fee?
Yes, there is typically a fee with loan modifications, just like you are serviced by a mortgage broker and a realtor when purchasing a home. Fees vary depending on the complexity of your loan and they range from $from a few hundred to a few thousand dollars.
How will a loan modification affect my credit?
Loan modifications have no negative effect on your credit, they can actually help your credit if you are late on your payments because they bring you current.
LENDERS HAVE THEIR BEST INTEREST AT HEART, NOT YOURS, SO EVEN CLIENTS THAT ARE SUCCESSFUL IN ACCOMPLISHING A LOAN MODIFICATION ON THEIR OWN USUALLY DO NOT RECEIVE THE SAME INTEREST RATE OR PAYMENT REDUCTION A LOAN MODIFICATION SPECIALIST COULD ACCOMPLISH!