A Loan Modification Program Can Keep You In Your Home!
Before you panic at the thought of losing your home, take some time to consider a loan modification program. You may be just a few words away from a loan payment you can afford and the security of staying in your home. We are experiencing troubling times of a magnitude few of us can relate to. This is a time to stay clear headed and make smart well thought out choices regarding home loans.
Your first step is to contact your current lender directly, or a local bank lender that you know and trust. While a loan modification can be your saving grace you must be sure that you are dealing with a reputable bank or lending company. This is not the time to fall victim to a scam. Call your mortgage company or visit a local bank.
A loan modification is a permanent change to one or more terms of your current home loan. This change is designed to reduce your payment so that you can afford it and stay in your home. It is similar to a refinance, but typically won’t result in cash back. Your modification can, however, be written to include late charges and missed payments so that you remain on good terms with your lender.
The federal government has allocated some 70 billion dollars to encourage banks and lenders to offer loan modification to their clients. This gives the banks the security they need to offer these options. It also gives the home owner some leverage in getting approved for a modification. There are also financial incentives for the borrowers in the form of loan reduction and cash credit toward your balance.
To see if you qualify for a loan modification you will need to meet with your lender and share your current financial situation. Your current inability to pay or a foreseeable future hardship will be the key ingredients to qualifying for a modification. It is in the best interest of banks to keep people in their homes, so if you are showing any sort of current or future economic hardship you should qualify. You do not need to be currently delinquent, or even moderately behind to qualify.
There are many forms of hardship that will help support your need for a loan modification. Divorce, loss of employment or reduction in employment, illness, death of spouse and military deployment are all acceptable hardships. Do not be discouraged if you haven’t experienced any of these specific hardships. Each case is different and your circumstances are unique to you. If you can show a need, then approval will not elude you.
Contact your banks loan modification department, or your own mortgage company to get started. Have your financial information organized and ready so that you can get through the pre-screening part of the process easily. You can do this alone, or with a financial adviser. If you are unsure then find a friend, spouse or professional to help you. Loan modification could be your defense against foreclosure!