The What, When, Where, Why, And How Of Loan Modification
Managing finances in the current economic climate of the country can be a difficult thing to do properly. The information available can be confusing and overwhelming, especially when it comes to understanding the solutions for troubled mortgages. Many homeowners think that the only option available to avoid defaulting on their mortgage is to foreclose. A mortgage modification is a feasible alternative to a foreclosure. Understanding the what, when, where, why and how of a loan modification is the first step in considering whether or not this is an option for your situation.
What is a loan modification? A mortgage modification is when your lending institution makes a permanent change to your mortgage by lowering the interest rate of your mortgage to a level where the monthly payment is less than 38% of the homeowner's monthly income.
When will the lower interest rate period end with a loan modification? Typically, the homeowner will be able to have that lower interest rate in place for five years. At the end of five years, the interest rate will increase to the original interest rate when the mortgage modification occurred.
Where should you apply for a loan modification? Application for a mortgage modification will be directly to the financial institution that holds your mortgage. Once you apply, they will tell you the specifics of the loan modification for which you qualify.
Why should you apply for a loan modification? Applying for a mortgage modification should occur when you are at risk for defaulting on your mortgage for any number of reasons, including low home values, unusual mortgage terms, and/or loss of income.
How do I apply for a loan to be modified? Compile a detailed listing of your income and expenses. Then contact your lending institution for their requirements to apply. They will likely ask you to write a hardship letter explaining the details of your financial situation along with your application.
One resource that no homeowner who wants to modify their home loan should be without is 60 minute loan modification. 60 minute loan mod is an all in one do it yourself kit. The kit will show you how to write a proper hardship letter, the kit also includes important terms, and vocabulary that you need to know. Most importantly the kit was created by a real estate professional who has modified five of his home loan and numerous loan of his clients.
What is a loan modification? A mortgage modification is when your lending institution makes a permanent change to your mortgage by lowering the interest rate of your mortgage to a level where the monthly payment is less than 38% of the homeowner's monthly income.
When will the lower interest rate period end with a loan modification? Typically, the homeowner will be able to have that lower interest rate in place for five years. At the end of five years, the interest rate will increase to the original interest rate when the mortgage modification occurred.
Where should you apply for a loan modification? Application for a mortgage modification will be directly to the financial institution that holds your mortgage. Once you apply, they will tell you the specifics of the loan modification for which you qualify.
Why should you apply for a loan modification? Applying for a mortgage modification should occur when you are at risk for defaulting on your mortgage for any number of reasons, including low home values, unusual mortgage terms, and/or loss of income.
How do I apply for a loan to be modified? Compile a detailed listing of your income and expenses. Then contact your lending institution for their requirements to apply. They will likely ask you to write a hardship letter explaining the details of your financial situation along with your application.
One resource that no homeowner who wants to modify their home loan should be without is 60 minute loan modification. 60 minute loan mod is an all in one do it yourself kit. The kit will show you how to write a proper hardship letter, the kit also includes important terms, and vocabulary that you need to know. Most importantly the kit was created by a real estate professional who has modified five of his home loan and numerous loan of his clients.
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