Short Sale Steps
If you are like so many others of millions of homeowners that are struggling with variable interest rate mortgages that have reset or about to reset and you can no longer afford you’re your currently monthly mortgage payment, then a mortgage modification might be the right answer for you if: your hardship is temporary, and you are able to afford the new payment if adjustments were made to it.
If you cannot afford the new payment, then you should contact me about other alternatives such as selling your home or doing a short sale. I also suggest you contact your lender or attorney about doing a deed in lieu of foreclosure. A deed in lieu of foreclosure is when you simply sign over the deed to the lender and give them the keys, walking away owing nothing. A foreclosure defense attorney may also be able to help you file litigation against the lender for predatory loan practices and/or lender violations if they have occurred, and as a last resort, bankruptcy.
Loan Modifications are typically not based on your credit score like refinancing. This means that your lender does not look at your credit score to determine your eligibility. Lenders look at the borrowers’ ability to repay their loan. No lender will grant your request for loan modification if you have no income. If you have too much income, you may not also qualify either.
The federal government has set the guidelines at 34% of gross income. However, if after expenses you have more income that that you can expect that you will not qualify. Also, remember these are only guidelines and if it does not make financial sense to your lender, they will turn you down, and can call the note and foreclose on the property if they choose. That is why is so important that you have to submit a convincing and complete case to the lender that makes sense to both parties.
If you decide that a mortgage modification is the right choice for your financial situation, if you follow my step by step process you should be able to submit your convincing case and negotiate your own mortgage modification. I will also be able to answer some of the most common questions and concerns that many homeowners have when faced with doing a mortgage modification. From contacting the lender from the beginning process to getting your mortgage modification approved at the end of the process.
Advantages and Disadvantages of Mortgage Modification
Keep in mind that the last thing lenders want right now is more inventory on their books. They need your money, not your property. Foreclosure is expensive and time consuming, and lenders and financial institutions are having enough trouble staying in business right now. They do not want to foreclose on your property. Lenders want to find a way to keep the loan as an asset, not incur more liabilities.
As a homeowner, a mortgage modification will allow you to keep your home and avoid the foreclosure process. Your payment is lowered to an amount that you can afford. Your credit is not ruined. Mortgage modifications work the best if you have an adjustable rate mortgage. There is no guarantee that the lender will agree to the mortgage modification, especially if your credit is badly damaged. Also, there are fees involved that the lender charges for this service.
