From Nightly Business Report: Mortgage Loan Modifications

The Fine Line for Mortgage Loan Modifications

posted by Stephanie Dhue, Correspondent at 5:50 PM on 07/28/09

There's a fine line between encouraging loan modifications and encouraging people to try to get a deal from their lender. The Obama Administration's foreclosure prevention plan requires borrowers to be at risk of "imminent default" to qualify for a loan modification. At the same time, the government wants to encourage borrowers and lenders not to wait until people are in foreclosure to address the problem, so borrowers can be current on their mortgage and still be eligible to have their loan modified. In those cases, the mortgage servicer has to document when someone will no longer be able to make their payment.

With lenders overwhelmed by a record number of loan defaults, the focus has been on the people who have stopped making their payments. If lenders made it easier for people who were in trouble, but not yet in default, there would probably be more successful loan modifications. Of course, that could also encourage people who aren't really in trouble to try to get a better deal.

Comments

[chrisparker]

Great article , thanks to track such problem. Obama-loanmodification; do you qualify, check it http://www.obama-loanmodification.com

[Alex Villa]

you have nice article, this is very helpful and deals relevantly with the issue. by the way, i have seen this site with excerpts on it regrding Obamas' plan, please check this one out.
On March 4, 2009 the $75 billion Homeowner Affordability and Stability Plan was passed into law by President Barack Obama. The White House has just released who will qualify and how to go about receiving a Loan Modification through the new plan. Here is what you must know!

Step 1: Determine if you are Eligible for your share of the $75 billion Bailout?

1. Do you live in the home?
2. Is your current loan amount within ($625,500 in high cost areas and for other areas $417,000)
3. Are your current house payments more than 31% of your gross income?(The Complete Loan modification kits will automatically calculate all financial ratios your lender may want to see)
4. Are you must be able to prove you have current income?
5. Do you currently have a job?
If you answered yes to these five questions there is a good chance you will qualify for a loan modification under the terms in the Homeowner Affordability and Stability Plan.

Step 2: Apply for a Loan Modification (Order and Instantly Download the Complete Loan Modification Kit)

You must act quickly; millions of American's will be trying to get a piece of the bailout! The sooner you act the better your chances are of receiving a loan modification. However, it is important to ensure that you have all your documentation in order so that when you do reach your lender they will be able to process your request quickly.
So in step 2 first prepare all documentation required by your lender then contact them. The Complete Loan Modification Kit has all document templates, forms and checklists your lender may request. With the Homeowner Affordability and Stability Plan if your loan qualifies there is a good chance that the lender will contact you. Be certain that the person claiming to be your lender truly is! But there is no guarantee your lender will contact you, therefore it is in your best interest to be proactive and contact them.
INSIDER TIP #1
It is important to understand that with Obama's Homeowner Affordability and Stability Plan lenders have a financial incentive, and they love money, to process as many loan modifications as possible. Therefore it is essential that if you want your lender to consider your case a high priority for them, you need to make it easy for them to process your application fast. Nothing will get your case dropped to the bottom of the pile faster than taking up an hr of your lenders time with questions you can learn easily if you read the included Loan Modification Manual. The Complete Loan Modification Kit Course Manual provides a clear overview of the loan modification process.
INSIDER TIP #2
One of the largest differences in the loan modification process that the Homeowner Affordability and Stability Plan will have is the fact that to receive a loan modification you do not need to be behind on your mortgage payment. Now if your ARM has been reset to a high rate and you answered yes to the questions in step 1 you can likely get your rate reduced to 4.5% fixed.
INSIDER TIP #3
Follow Up! It is especially important now, with so many loan modifications being started that you stay in contact with your lender and ensure your case is being handled effectively.
MORE INSIDER TIPS IN THE KIT!
http://www.foreclosuresmedic.com

[johan Tekila]

great article , thanks; What I know and can say that Obam is doing well for people in dept and foreclosure. mini course on how to avoid forerclosure: http://www.obama-loanmodification.com

[Ron Stone]

It's a fine line to walk but needed. Probably the best answer is to see if the borrower would "re-qualify" for their current mortgage. That would filter out most of the abuse. I also think lenders need to be more communicative about people's options. Many borrowers don't even know their options. Unfortunately, doing so will probably inundate the lenders and mortgage servicers. But better covered up with modification requests than foreclosures.

[Betty]

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Betty

http://mortgagecalculato-r.com