Frequently Asked Questions
What is a Loan Modification?
A loan modification is different from a mortgage loan refinance. A loan modification changes the terms of the original loan rather than creating an entirely new loan agreement. A loan modification is the best way for a homeowner that is having trouble making their monthly payment to get relief because it can lower the interest rate of the loan, the amount of the monthly payment that is due, and sometimes it can extend the length of the loan which will lower payments even further. In order to get the best terms for a loan modification it’s important that you choose a specialist that has a lot of experience negotiating loan modifications with lenders so that you can get the lowest possible monthly payment.
Are you a Good Candidate for Loan Modification?
There are basically 3 conditions that must be met for you to be a good candidate for loan modificaion. 1) You must be still employed, 2) You must want to stay in your home and save it from entering foreclosure 3) You must have had a financial hardship occur in your life making it difficult to keep up with your mortgage payments. If you are a homeowner that took out an interest only mortgage, like millions of homeowners did, and are now facing huge increases of the amount of the original payment then you certainly qualify for a loan modification. The rate increase does count as a financial hardship. Some lenders will give you a reduction in the amount of your payment for a month or two but that temporary measure will not give you any long term relief from mortgage payments that are much higher than your initial payment was. If you are facing huge increases in your monthly payment amount don’t wait for your payments to increase before you take action. It’s much for you to start working with a loan modification negotiator now to find a way to lessen your monthly payment before the increase takes effect.
What Happens During a Loan Modification?
If you decide to try a loan modification then an experienced loan modification negotiator will work with your lender to modify the terms of the original loan so that you will have a lower interest rate and a monthly payment that you can afford without having difficulty paying other bills or meeting other financial obligations.
Is Loan Modification similar to Debt Consolidation or Refinancing?
No, loan modifications are different than debt consolidation or refinancing. Debt consolidation and refinancing are ways to get rid of all of your unsecured debt by grouping them all together and making one monthly payment towards the entire debt. Debt consolidation does not include your mortgage loan. Refinancing is taking out another loan with different terms to pay off the original loan. Loan modification, however, changes the terms of the original loan to make your monthly payment more affordable.
What is needed from me to get the process started?
Any and all paperwork that you have from your original mortgage loan plus documents that can verify your current income and financial status are what a loan modification company needs in order to start the process. Once you turn the paperwork over to your negotiator your part is done. You won’t have to attend a closing or any negotiation meetings.
How long is the Loan Modification process?
Lenders are usually just as eager as homeowners to get the loan modification process started. They know it’s in their best interest to help you stay in your home and keep making payments on your loan rather than incur the expense of foreclosure and resale of the home. If you have an FHA guaranteed loan your loan modification could take as little as two weeks. Often lenders will allow homeowners to skip a monthly payment during the negotiation process which will also ease your financial burden.
What are typical success rates?
We have an excellent track record of negotiating loan modifications for our clients. Our experienced and well trained negotiators have the legal experience, ethics necessary to get you a loan modification that will help you save your credit and your home, often within 60 to 90 days.
