5 Loan Modification Tips
1. You will need to have personal documents handy. You mortgage company is going to need personal documents like: award letters for income(such as fixed income, unemployment income, child support income, etc.), recent pay stub, utility bills, bank statements, recent tax returns. These documents are necessary and vital part of getting your payments lowered. If you do not have these documents it will greatly reduce your chances of getting a mortgage loan modification, your lender will need documentation to provide you with assistance.
2. Follow up often with your mortgage company. Mortgage companies can be impatient when they are processing your paperwork for a loan modification, and if they are missing something that is important in their quest to modify your mortgage payments they could request the missing document once or twice before denying you. Checking in about once a week is considered sufficient. Things can change often, and if they go too long without hearing from you once they have requested something from you, they may deny you if they do not hear back from you in a reasonable amount of time regarding a request. For example, if they need a letter from your employer with your hire date, and they sent a letter to you last week and still have not hear back from you in a week; they will sometimes deny you. If you are denied you will often have to start all over again once you have provided them with what they have requested.
3. Make sure not to falsify any of your personal information just to get mortgage assistance. Mortgage companies work closely with government agencies, they use most of the government‘s guidelines to create some of the popular modification programs. After all most of the loan modification programs are government funded. I know some loan modification programs are lender created and funded, but that is a small percentages of the mortgage loan modifications programs being granted to borrowers. Believe me, there are homeowners that have twisted the truth especially with their income, and may face a grand jury for possible criminal charges at some point in the near future. In fact, there are cases of real estate agents, attorney, among other mortgage professional that have been indicted for falsifying documents, trust me it‘s not worth it. Mortgage companies are happy to work with the federal government to help prosecute any dishonest homeowner or mortgage professional that is falsifying mortgage documents. There is a new criminal background check specifically relating to the mortgage industry and real estate that has to conducted on each borrower seeking government mortgage assistance. It is easy enough to get a loan modification if you qualify without falsifying your pay stubs, tax returns, utility bills, etc. to lower your mortgage a few hundred dollars. This type of fraud is a federal offense, and there are tons of mortgage professionals and borrowers who wish they did not broke the law for personal financial gains. Even just supplying false documents whether you get a modification or not, it is the intent to deceive and that is where the lines of legalities are being crossed. Again, getting a criminal record is not worth it in the long run.
4. Watch your property’s sale date. If you are doing a loan modification but you are in foreclosure be careful. If you are doing a loan modification and you are in foreclosure keep a close eye on your sale date. Even though your mortgage company will generally automatically extend your sale date if your are in foreclosure and working on a modification, still check up on it. If your mortgage has not been modified your loan, it is important to make sure that your lender is keeping your sale date in mind. Make sure your lender does not let your property sell in the mean time, ask them to extend your sale date. I have personally seen houses that were under a loan modification review that should not have gone to sale but they did.
5. Lets say you do get a loan modification follow the guidelines. I have seen enough homeowners including some that I have helped to get a trial mortgage loan modification and they thought they had made it, but they are surprised later on with bad news of not completing the requirement for the modification. You can be granted a trial loan modification that last about 3-5 months, and if you are granted one you still need to pay attention and keep checking back with your bank regularly. They might still need something from you at that point, and if they do not receive it from you they will eventually deny you. And guess what, if you want to continue you will have to start all over again. It’s a waste of time at that point, all you have to do is follow up about once a week and make sure everything is going well. If you are granted a loan modification you will normally go through a trial period to see if you are capable of make the payments during the short trial period of 3-5mths. Once you have completed the trial period successfully then you will be granted the actual loan modification. If you start making your payments on time after the trial period you will notice your credit will slowly begin to improve.
