Qualifying for a Loan Modification

There are many lender loan modification programs out there today. That is why hiring an attorney is a smart thing to do. Your attorney can help you sift through all the information and find the best options for you to save your home form foreclosure now. The attorney can also help you stop foreclosure while you are waiting for the loan modification. Your real estate attorney will be able to explain the modification guidelines to you and the process as well.

Here are some of the guidelines for the government’s Making Home Affordable or HAMP program:

• Your residence must be your primary residence. No investment or second home properties qualify under this program.
• Your loan must be no more than $729,750. Jumbo mortgages on multi-million dollar properties do not qualify.
• You must have had your mortgage for at least one year.
• Reducing your mortgage payment to 31% of your gross income makes a difference in whether you can afford to stay in your home or not. To determine this percentage, multiply your gross income by .31.

Why Use an Attorney?

If you qualify, then your attorney can get things going for you by completing the application, the hardship letter and advising you about what financial information you will need to supply to the lender to get your modification approved. Most lenders want copies of your W-2 or 1099’s, your last two paycheck stubs, couple months bank statements, tax returns for the last two years and a financial statement listing your debts and assets.

The attorney deals with mortgage modification applications on a daily basis so he or she knows what department at your lender’s offices to contact and who to speak with. Once a negotiator is assigned, the process goes faster. The attorney will be able to negotiate the terms and conditions of your modification so you can get on with your life. Mortgage modifications only work though if you have the money to make the reduced payment and you pay them on time. Mortgage modifications are short term fixes until your financial situation improves. They allow you stay in your home and avoid foreclosure so it is worth exploring a mortgage modification as an option to save your home from foreclosure.

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