Thursday, October 16, 2008

Loan Modification Help

Having problems making your mortgage payment now? Worried about paying your monthly mortgage payment in the future?

Please be careful of the new loan modification scams cropping up. Unfortunately many of these companies are the same companies that sold people these tricky loans. If you are going to pay for help, you should make sure an attorney is involved in the negotiations.

As you will see if you start a loan modification, many lenders will not respond and/or your paperwork will be lost. When a financial package is prepared by an attorney - the banks pay more attention to your file. Don't let me mislead you - lender's are overwhelmed right now - this will take time. Also, because of the amount of time this will take, you should start this process sooner rather than later.

What happens in a loan modification? A number of changes can be made to your home loan in a loan modification. First, lenders are much more likely to modify loans on your home - not investment property. Second, the modifications will depend on your particular situation. Some of the modifications that we are seeing are maintaining your current interest rate (before your rate resets), reducing your interest rate, allowing you to not make payments for a few months (aka forbearance), forgiving late fees or other costs and/or reducing the principal amount of your mortgage.

Good luck!

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