Frequently Asked Questions

What is a Loan Modification?

In simplest terms, a loan modification restructures the terms of a loan without actually refinancing the property it secures. Investopedia defines a loan modification as an agreement between the lender and the borrower which stipulates a long term relief from untenable loan terms. Modification of a loan applies to the terms governing the interest rate, the amount of the monthly payment, and in some cases also the length of the loan. Skilled home modification certified foreclosure consultants work on behalf of borrowers with their lenders to achieve the relief of a home loan modification via drastically reduced mortgage payments. Get Help - Save Your Home!

Are you a good candidate for Loan Modification?

Any homeowner currently stuck with an adjustable rate mortgage that has been or will be adjusting upwards is a premier candidate for loan modification. Millions of Americans were lured into signing up for interest only mortgage loans and while initially the loan was low and affordable, the double impact of rising interest rates and the inclusion of principal into the payment have caused borrowers to see their payments double or even triple!

Remember if you wait too long you may be ineligible for a loan modification program. Do not wait until your ARM or Interest-Only Loan resets again but instead act as soon as you realize that your financial situation is putting you at risk for foreclosure. Act Now!

What happens during a Loan Modification?

During a loan modification the terms of your mortgage are renegotiated to bring the interest rate down to a percentage that fits into your budget and the monthly payment no longer presents a severe strain on your ability to meet your other financial obligations.

What is a Principal Reduction?

Principal Reduction is the actual decrease of a borrower’s total loan amount. A Principal Reduction can be used sometimes to bring down a borrower’s payments when traditional loan modification tactics do not offer enough relief. Principal Reductions are very hard to get from the lender but do happen from time to time if a lender really wants to prevent foreclosure and help the borrower.

Can I get a Principal Reduction?

The answer to this question is maybe. Principal reductions are very rare and cannot be counted on in most loan modifications. However, they do happen sometimes and they are becoming increasing more apparent as the traditional loan modifications where the lender only reduces the rate continue to have high re-delinquency rates. Our specialists know how helpful a Principal Reduction can be and they try to achieve one on every single modification they do. Pease remember though that these Principal Reductions are still very rare and difficult to get and the vast majority of modifications do not include them.

Why don’t I simply ask my lender for a Loan Modification myself?

It would be great if borrowers and lenders had the ability to negotiate loan modifications, but the problem is two-fold: many lenders simply lack well trained loan officers who know how to negotiate and set up a loan modification in the first place; secondly, some lenders are more interested in recouping any potential losses up front via a foreclosure than they are in keeping a customer for a long period of time with the help of a renegotiated mortgage. In both cases it is the involvement of certified foreclosure consultants that provide borrowers with the results they desire.

Is Loan Modification similar to Debt Consolidation or Refinancing?

The answer is a resounding no. Debt consolidation seeks to lump a group of unsecured debts into either a loan or a program that offers lower payments. It does not apply to mortgages. Refinancing a home requires the borrower to apply for a new mortgage for the home and as such will require a down payment, an appraisal, and a lot of fees for the lender. This is often not an affordable solution for a borrower who is already stretched to the max with the current mortgage payment and the existence of an adjustable rate mortgage that eats up a lot of the available funds on a monthly basis may actually be held against the applicant and thus causes the refinance application to be denied. Loan modification seeks to restructure an existing loan.

What is needed from me to get the process started?

Documents relating to your financial situation, income, and mortgage details help certified foreclosure consultants to draft the papers your lender requires for a need based loan modification approval. Upon receipt, the terms of the mortgage are renegotiated to reflect a lower monthly payment. Best of all, the paperwork is handled in its entirety by the professionals in charge of negotiating the deal and you are not required to attend a closing or any such meeting.

How long is the Loan Modification process?

You will see relief in as little as 60-120 days if FHA guaranteed loans are involved. In the meantime, lenders are amenable to halting foreclosure proceedings and even the sale of a home! The added benefit of this process rests in the fact that you may be able to skip one mortgage payment and get back on your feet with your budget. Since the majority of reputable lenders prefer to have you remain a customer for life than selling off your home at a loss and thus not realizing the profit of the interest payments, the process is usually not delayed.

What are typical success rates?

Our success rate is stellar and our commitment to our clients is unwavering. With several professional and ethical companies forming our network of loan modification servicing firms,your loan modification is in good hands and within 60 to 120 days you may be back on the road to fiscal health and keeping your home.