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How Mortgage Loan modification programs work?

How Mortgage Loan modification programs work?

By Julianne Fitzgerald
On 04 Apr, 2014

    In order to evade having a foreclosure, your lender has the possibility to comply with modifying a few of the terms on your loan, or all of the terms.

    Mortgage Loan modification programs

    A loan modification is when a compromise is made between both lender and yourself. This process is initiated by contracting your Mortgage Company, and a loan modification attorney that will examine your situation and recommending a solution that consists of adjusting the loan.

    The process of Government Modification Programs

    The objective of a loan modification in Miami program is to get your monthly payment minimized to a level which is affordable. When discussing a more affordable mortgage payment this means that it is described as 31% monthly gross income of the borrower. For instance, if you’re monthly gross income is an average of $4,200 per month, and your loan is adjusted to be 31% of this income you will be paying about $1,302 per month.

    Home Affordable Modification Plan

    It was introduced by the Obama Administration the home affordable modification plan as a part of making the plan a way to balance the homes in demand. Through this plan, your monthly loan premiums are minimized by altering one more parts of your mortgage such as:

    • Minimizing the interest rate
    • Prolonging the life of the loan
    • Minimize the loan principal

    How to Qualify

    In order to determine if you qualify for a loan modification, use a Loan Modification Evaluator in order to evaluate your mortgage options.

    Personal eligibility

    If you can prove that you are experiencing financial hardship that impacts your ability to make your loan payments, you have the possibility of qualifying. Contradicting many popular beliefs, it is not necessary for you to be behind on your monthly payments prior to a lender considering doing a loan modification with you.

    If you are in a predicament where you are late on your mortgage payments or in a situation where you are facing foreclosure, then applying for a loan modification can help you by placing a temporary stop on the foreclosure process.

    Mortgage eligibility

    In order for you to have a qualifying loan under the Home Affordable Modification Plan there are some conditions that you must qualify for:

    • If the property has not been convicted
    • You are struggling with a financial hardship and are in danger of sliding behind on your mortgage payments or if you are a non-owner who is a delinquent, in order to qualify

    There are many other qualifications that must be provided, if you are looking to obtain more information contact a loan modification attorney in order to discuss further options.