What Is Loan Modification?
When you and your lender agree to change your loan agreement permanently to give you a more affordable mortgage payment. This is generally done to avoid foreclosure and stay in your home.
What Do I Need To Qualify For Loan Modification
You need to prove financial hardship through documented evidence to your bank, but you also have to prove that you are still a profitable borrower for your bank so they don’t just decide to foreclose. If you decide to get a loan modification through the federal Making Home Affordable plan, your application’s approval will be less determined by your lender’s judgment and more on your meeting of more stringent listed requirements.
Can I Still Ask For A Loan Modification If I Am Late On My Mortgage Payments
Generally speaking, you should ask for a modification before it comes to that. The more late payments you have, the more difficult it will be to convince a bank that you are a worthwhile borrower. However, many banks will still grant you a loan modification as long as you can explain any irregularities. You should try to gauge if you will not be able to make your mortgage payment and if not, contact your bank as soon as possible.
What Do Banks See As Acceptable Hardship
If you have a job loss or income reduction, if you or a co-borrower or family member dies or becomes ill, if you are forced to relocate, if you are called to military service or if you accrue high medical bills, they will be willing to consider your loan modification. You will need to include a compelling hardship letter in your application for a loan modification to show this to your banker.
Should I Hire An Attorney To Help Me With My Loan Modification
While you do not need to hire a lawyer, a loan modification attorney can make the entire process much easier and save you dozens of hours of poring over complex paperwork. Your lawyer will advise you about how to write your hardship letter and what evidence to include so you have the best bet of convincing your lender to modify your loan.
If you are concerned that you will not be able to make your next mortgage payment, contact a loan modification lawyer today and get started on your loan modification application process!