We help homeowners restructure their mortgage loans so that they can save their homes. Governmental regulations were enacted in response to the Mortgage Crisis that occurred from 2007-2009. One of the regulations allows your existing mortgage company to modify your mortgage if you meet the criteria. We work with your mortgage company to help facilitate this process, which can be frustrating and lengthy on your own without proper representation. Modification is ideal for people who have bad interest rates, people who are back at work after a period of unemployment, or people who have had a slight reduction in income that makes it difficult to keep up with their monthly obligations.
What is Mortgage Modification?
Modifying your mortgage will change the terms of the original loan, without going through the more traditional refinancing process. It can result in a change in your overall payment, your mortgage interest rate, and the length of your mortgage. It also restructures your loan so that you are no longer behind or in default.
Am I eligible for a Mortgage Modification?
Are you currently or soon to be behind on your mortgage? Have you suffered a hardship that changed your ability to make the original payment? Is your income sufficient to support a modified mortgage payment, but not so excessive that it should be easy for you to make your existing mortgage payment? If you answered “YES” to each of those questions, then you are likely eligible for a modification.
The good news is that there is no credit requirement. This is important because many people that can no longer afford their original mortgage payment have suffered a financial setback that has rendered them unable to meet other debt obligations.
Does the mortgage company have to accept my Mortgage Modification?
Your mortgage company has to approve your modification ONLY IF you can prove to them that you are eligible. However, the bank is required to use a very strict household income formula that they will not share with you. The formula requires exact income figures for an exact period of time as well as a consideration of current market interest rates. So, unfortunately, you may not be eligible from the very beginning due to the numbers not perfectly lining up, but they won’t tell you that.
They will also not “run the numbers” in advance based upon your representations of your income.
Furthermore, if you do not provide everything perfectly, they will not consider you for modification. They are incredibly strict and picky about this. In fact, this is the number one reason that modifications get rejected. The required documentation includes a letter from you that is important; it specifically explains your financial hardship. It also includes a specific time period for pay stubs. If your pay varies even slightly, then the timing of your modification application is supremely important.
What is the Mortgage Modification process?
Once you are in default, the mortgage company will send you a loss mitigation packet or letter. You can also request this information from them. You will likely get a call from a mortgage representative that wishes to discuss these options with you. BEWARE of false hope: all of that will happen even if there is no way that you qualify for a modification. You will be required to fill out forms, submit documents, and wait. You will be asked to make three (3) trial payments. If you can make those payments AND your application is complete AND your documents support your eligibility, then you will have modified your mortgage.
What will my mortgage payment be after I modify?
Are you ready for a great legal answer? It depends. Your eventual mortgage payment will depend on a number of factors, including household income, interest rates, the term of your mortgage, and your mortgage balance. It is possible that you will greatly reduce your mortgage payment, but it is possible that it could also go up! Of course, if this happens, you don’t have to accept the increase. A capable and experienced attorney will be able to approximate your modified mortgage payment.
Can I modify my second mortgage?
You can attempt to negotiate it, but the governmentally regulated mortgage modifications are limited to primary mortgages on your primary residence.
Do I have to go to court to make this happen?
No, it is not a legal proceeding that requires an appearance of any kind. An attorney can prepare and submit your loan modification application without going to court.
How long will it take to get the modification?
It can take as little as a few weeks until you are making your trial payments. It can take much longer, though, if you can’t provide the mortgage company with everything they need from the beginning. We can help determine the ideal timing to submit your loan modification.
Can I modify if I’ve already modified my loan before?
In most circumstances, yes. Let’s talk about your situation to see if you can.
Do I have any other options?
Of course you do! You have other options to save your home. You have options to eliminate your mortgage debt completely. You have options that involve surrendering your home. You should talk with a professional who is comfortable discussing ALL of your mortgage options, even options that involve surrendering your home. Remember, an EDUCATED DECISION requires not only understanding what you are choosing to do, but also understanding the available options that you are choosing against.