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any people are paying for loan modifications… Why pay for something that can be done for free?
Get your free custom loan modification kit, specific to your lender.
“What is a loan modification?”
A Loan Modification is a permanent change in one or more of the terms of a mortgagor’s loan, allows the loan to be reinstated, and results in a payment the mortgagor can afford.
“Do they work?”
According to the report done by the Treasury shown below, less than 1% of Loan Modification Applications have been accepted as permanent modifications by Lenders. More than 99% of Loan Modifications are only temporary “Trial Period Plan” modifications. Those are NOT good numbers!
According to the Obama Making Home Affordable website, the guidelines for a loan modification are:
Borrower eligibility is based on meeting specific criteria including:
• Borrower is delinquent on their mortgage or faces imminent risk of default
• Property is occupied as borrower’s primary residence
• Mortgage was originated on or before Jan. 1, 2009 and unpaid principal balance must be no greater than $729,750 for one-unit properties.
After determining a borrower’s eligibility, a servicer will take a series of steps to adjust the monthly mortgage payment to 31% of a borrower’s total pretax monthly income:
• First, reduce the interest rate to as low as 2%,
• Next, if necessary, extend the loan term to 40 years,
• Finally, if necessary, forbear (defer) a portion of the principal until the loan is paid off and waive interest on the deferred amount.
Note: Servicers may elect to forgive principal under HAMP on a stand alone basis or before any modification step in order to achieve the target monthly mortgage payment
“What does that mean?”
50% of Loan Modification are currently in default AGAIN! Because they are NOT principle reductions. That means that instead of a 30 year mortgage you now have a 40 or 50 year mortgage. And if you need to sell your home in say, two years, you still owe that over inflated price putting you into the same position again!
“How much do you charge?”
In short, FREE! On October 11, 2009, Governor Schwarzenegger signed Senate Bill 94 (Calderon), and the legislation took effect immediately upon his signature. Thus, California law now prohibits any person, including real estate licensees and attorneys, from demanding or collecting an advance fee from a consumer for loan modification or mortgage loan forbearance services affecting 1 – 4 unit residential dwellings.
You should NEVER pay anyone to help you do something that is FREE!
“What do I do next?”
If you still want to try to do a loan modification, I can help guide you through the process for FREE! But if you are ready to consider a Short Sale, I can help you as well.
Fill out this short form and we will contact you to answer any questions you may have and to tell you how to start the process.