Mortgage After Loan Modification

Home Buyers Can Now Qualify For Mortgage After Loan Modification:

The purpose of loan modification programs are to modify the existing mortgage loan a homeowner has to make the monthly mortgage payments affordable and avoid foreclosure. Loan modification can be done by restructuring the existing mortgage loan note by decreasing the mortgage rates of the home loan and extending the term of the mortgage loan, thus, lowering the monthly payments. As long as the mortgage loan borrower has current income and can afford a reduced monthly payment, loan modification is an ideal compromise between buyer and lender where the homeowner can still own their home and the bank does not have to worry about a defaulted mortgage loan and avoid foreclosure proceedings. Loan modification programs are more easier to get these days from mortgage lenders due to the mass foreclosure crisis since the real estate and credit collapse of 2008.

 Mortgage After Loan Modification Programs: Benefits To Homeowners

A loan modification is a great way of getting out of default of your mortgage loan and avoid foreclosure. With a loan modification, you mortgage lender can reduce your current mortgage rate and extend the terms of your mortgage loan to make your new modified mortgage monthly payment affordable where you do not have to struggle every month.  The mortgage lender will be reviewing your financials and before they will approve a loan modification for you, they will make sure that you will be able to afford it. A Loan Modification is not the end of the world in you being able to obtain another mortgage loan. Home buyers or homeowners can qualify for mortgage after loan modification after passing mandatory waiting period. To qualify for a FHA mortgage after loan modification, the waiting period is one year after the loan modification to qualify. To qualify for a conventional mortgage after loan modification, the waiting period can be up to 4 years to get mortgage after loan modification.

Loan Modification: Am I Eligible For A Loan Modification?

There are two different types of loan modification programs. Government and private. Most loan modification programs require that the homeowner prove financial hardship due to job transfer or underemployment which resulted in a drastic loss of household income which affects them in making their mortgage payment.  They need to have a job and a consistent income source and provide W-2s, tax returns, and recent paycheck stubs.  The mortgage lender will review income, assets, and liabilities and will offer the homeowner a revised monthly mortgage amount he or she is able to afford.

Be Aware Of Loan Modification Companies

You do not need a loan modification company to do a loan modification.  Contact your current mortgage lender and speak with someone from the workout or loan modification department.  Whatever a loan modification company can do, you can do it yourself.  Remember that your mortgage lender are not in the business of real estate and do not want your property and will do everything possible to help you avoid foreclosure.  If you are adamant in hiring a loan modification company, make sure they do not charge you an up front fee for services not yet performed.  Be careful with loan modification companies that ask for an up front processing fee which is the same as an up front fee.  It is illegal to charge a consumer an up front fee for loan modification, credit repair, or any type of mortgage/financial related services.  Ask for references and check out their references and use the powerful tool of Google to see if they are reputable and that there are not in any sort of investigation by a regulatory agency.  In the event if you get your loan modification request denied, there are other options available to you which include bankruptcy, deed in lieu of foreclosure, or short sale.  A chapter 13 bankruptcy will allow you to keep your home and the trustee will do a workout repayment plan where you get to keep your home and avoid foreclosure.  If there is a will, there is always a way so do not panic and take one step at a time.

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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