Loan Modifications

Obtain a Loan Modifications to Prevent Mortgage Foreclosures
A loan modification allows a homeowner to negotiate with a lender to alter the existing terms of a mortgage loan. A homeowner is usually facing great financial difficulties and is unable to make minimum monthly payments. One's home may have also drastically decreased in value as a result of changing home values on the market. There are three major ways in which a mortgage loan may be changed, and these ways include changing the mortgage interest rate, amount of monthly payments and term. Usually, a borrower is trying to reduce monthly payments for a loan so that they do not accumulate to more than 30 percent of one's gross income.

Obtaining a Loan Modification -  Only those who are current homeowners can usually qualify for loan modifications through government programs. If a person purchased a home for investment purposes and does not currently occupy the home, then he or she will likely be ineligible to qualify for a loan modification. One who has a loan that exceeds the amount of $417,000 will usually be unable to qualify for a loan modification. A person may have more than one loan and still qualify for loan modifications. If a person has two mortgage loans, then the combined total may not exceed $530,000 for a loan modification.

Contacting a Lender -   Once you have determined to obtain a loan modification, your first step should be to contact a mortgage lender. You should request to speak with someone from the loss mitigation department. All you have to do is then explain your current financial state of affairs, and the lender will then assess your loan situation. You may be able to obtain an instant loan modification over the phone. Some lenders will be willing to make a loan modification with you over the phone for the incentives that they are able to receive. Lenders can receive up to $1,000 for each modification that they make for consumers.

When you speak with a lender on the phone, you should be sure to keep detailed notes about what is said. You may need to refer to these notes later in the event that you face foreclosure.