Tuesday, September 8, 2009

Help With Your Loan Modification

Homeowners who are struggling to make payments on their home loans can now use loan modification help to convert their high-priced loans into smaller, more affordable monthly payments. Find out what lender loan modifications are and see if you are eligible to qualify for them. The following are some of the questions you might ask if you are going to apply for a loan modification and the answers to your questions:

  • What qualifies you for loan modification help? If you have been a victim of a financial tragedy or have an adjustable rate mortgage then you might be eligible to qualify for a loan modification which will lower your monthly mortgage payments.
  • How does the lender decide how my new lower payment will come to be? This varies from bank to bank so you should check with your bank and find out what their rate is. Usually most banks will make the payment anywhere from 37-41% of your gross monthly income.
  • Will my interest rate be decreased? Most loans involve one or more of the following: A lower interest rate, principal forbearance, a more spanned out loan term, or an interest only period. Generally, there will be a combination of any of these scenarios to arrive at a lower mortgage payment.
  • What about all of the numerous penalties and fees that were added to my loan? In most situations the lenders will void the fees and penalties; this is part of the loan modification program. You will still be responsible for the payments that you missed, however they will be spread out over the term of your loan.
  • What is the cost of loan modification help? When you apply, the bank will not charge you, but you should be ready to make a payment once you come to terms with the loan workout. At the beginning of the loan modification, most lenders will ask you to provide them with the first five months payment.
  • How can I find out what programs are available to me? You will need to speak to someone in your bank’s loss mitigation department and request an application package. The Complete Loan Modification Guide can also assist you with learning about the various programs as well as helping you set up and send you package for reviewing.
  • Do you have to have a bad history with your payments to get help? Most lenders do not require this; however you will face an interest adjustment rate or a reduced income in the future. Homeowners who are in danger of losing their homes will be given first choice for this service. Just remember, the sooner you submit an application, the sooner you will receive help.
  • Which is better: Going through a loan modification company or using my bank? In most situations using your bank is the better choice. A lot of these loan modification companies do not know what they are doing and do not guarantee you success. If your specific case is complicated then you should seek out an attorney with experience in this field.
  • How is do-it-yourself loan modification? To successfully do this you must do research in this field. Plenty of borrowers have modified their loans successfully and you can too. A knowledgeable homeowner, who is persistent, should have no problem receiving loan modification help from the lender of their choice.
  • Where do I begin? There is an easy to understand handbook that will take you through this process step-by-step so that you can get the results that you desire.

1 comment:

Anonymous said...

Great article, its very helpful. I think I will check out that Loan Modification Help page you mention.