Loan Modifications Help People

Paying your monthly mortgage payment can be difficult, especially if you have lost your job, have experienced a decrease in your income or you have had the mortgage payment adjust to a higher amount. The government and many lenders understand that it is simply too hard for some homeowners to remain in their current loans. However, if you stopped making payments or did not pay what you owed each month, the lender has no choice but to foreclose on your home. This is not what you want to see happen. Foreclosure destroys your credit and can prevent you from owning a home in the future.

A loan modification is a solution to avoiding foreclosure. It has changed the lives of thousands of people already. Imagine if you had the ability to catch up in your mortgage payments. Perhaps you would be able to pay less per month. This could mean many things for you.

• Reduce the amount of stress you are under right now. Get back to living life not worrying about money.
• Be a proud homeowner knowing that you are working towards full homeownership.
• Pay less. Why pay too much for a mortgage when you may qualify to pay less and not have any significant ding on your credit report for doing so?

How Can You Be Next?

In many situations, homeowners do quality for home loan modifications. The key is taking advantage of this offer. It is unlikely that your lender will come to you to modify your home loan, even if you start to fall behind. Rather, be proactive and take steps to modifying your mortgage into a more affordable one.

Contact a loan modification counselor directly. Find out if you qualify for a home loan. Let this company know what you need. Some homeowners just need to get caught up on payments. Other homeowners need a lower monthly payment. Since the government is offering incentives to lenders, investors and servicers who are willing to modify home loans, many people will have no problem getting into a home loan modification.

You can be part of the thousands of people getting help with their mortgage. Loan modifications can help you to remain in your home. They can help you to feel better about your financial situation and even strengthen your family. Over time, they can even help you to improve your credit and financial circumstances by helping you to avoid foreclosure. These new loan modifications can help you to be in a better place than you are right now.

However, they, like other lenders, have been increasing their output as more effort is made to increase system efficiency.

Recently, we saw a great result from Bank of America under the government program.

This particular homeowner had a fairly typical experience with for those that obtain a loan modification. Her offer came within just under four months. While this may seem like a long time, it’s probably a little faster than most.

Her patience was recently rewarded with a significant monthly savings. With an original payment of $2,700 and an interest rate at 8.99%, there was some fear of not being able to keep up even though she had not yet missed a payment.

As of this morning, she is now saving $804.57 per month on her new payment of $1,539.98. Like all Making Home Affordable modifications, she will have to make that payment for three months on a trial basis before the modification will become permanent.

We’re very happy for her and her family and hopeful that this significant savings gives them the right amount of financial relief in these turbulent times.

Some great results have been seen with GMAC and the Making Home Affordable plan and at a quicker pace than with many other lenders.

We recently highlighted three cases on our GMAC loan modification profile page. The longest of them took three months. If that seems like a lot, you haven’t seen the results of other lenders. One recent mod was approved after 12 months and multiple rejections. Hard work from your mitigation team and patience is a requirement with most lenders, but GMAC’s performance has been impressive.

The three highlighted cases, which you can read about by clicking the link above, saved clients an average of $679.96 per month on their monthly mortgage payment. The reductions ranged from 17% to 36% of the previous total mortgage payment.

The results are ultimately based on a number of factors pertaining to your personal situation. A result cannot be guaranteed, but a reasonable idea of success can be determined through the qualification process.

The modification took over 8 months to achieve but the results are stunning. Not only did he keep his home while we were working the case, we secured him a new monthly payment of $1,300.72. That’s a savings of $964.28. He only has to pay one month’s mortgage payment to the lender to get reinstated and the rest of the $27,200 owed to the lender has been brought current and placed at the end of the loan.

We tell clients all the time, be patient. It’s not easy getting a loan modification and lenders are tough to work with. This is a perfect example of what can be achieved with hard work and patience.

Loan modification can mean everything to a homeowner no matter what your mortgage payment is. Two recent success stories show this.

• A homeowner with Bayview Loan Servicing started with a  $4,511.16 monthly mortgage payment. This person could not sustain the payments if they couldn’t be adjusted. By utilizing the Making Home Affordable plan, this client’s payment was reduced to $2,313.55. That is an astronomical savings of $2,195.61 per month. Needless to say, that’s an incredibly satisfactory result.
• Another homeowner began working on their $913.61 monthly payment with NationStar Mortgage. After the negotiating company’s work was complete, the result was a 30 year fixed loan at 5.5% for the client with a payment reduction to $672.29 per month. They are saving $241.32 every month now. This new payment is nearly a 30% reduction and even though it’s much smaller, represents the difference between home affordability and foreclosure.

With another round of government intervention in the mortgage industry and foreclosure crisis, it is fitting to remember what the last round brought us. Not a lot unfortunately. Many homeowners facing the uncertainty of foreclosure have turned to private professionals to intervene.

There are a number of success stories for third party mitigation companies to be proud of.  Success for these businesses means someone gets to stay in their home. There is a reason why so many people refer to their house as their ‘home.’

Just one recent example of a success story was this one:

A homeowner with an Indymac loan was straddled with a $2940.00 monthly mortgage payment. Although their existing interest rate was a reasonable 6%, the payment was putting them in jeopardy of losing their home.

This is how it can work

With third party intervention, the result was a payment reduced to $2120.62 representing an $820 monthly savings. The negotiation resulted in a re-amortized term of 40 years with an interest rate of just 3%. The total savings over the life of the loan; $393,600.00. Best of all, the renegotiated loan allows for paying down the principal, which wasn’t happening with the original loan.

Loan modification can help make a bad situation bearable. As a matter of fact, it can turn around the inevitability of foreclosure and save a homeowner from losing their home.

Experienced loss-mitigation experts can intervene on behalf of homeowners to negotiate a more manageable loan payment. There are other success stories listed on this blog.

Negotiators can either work to keep a homeowner in their home or help to preserve credit when a homeowner decides to take the short sale route. Any time these goals are achieved, it is a good day.

Example of a Success Case with the Making Home Affordable Plan

The client started with a monthly payment of $2724.43 per month. After a successful negotiation with Countrywide/B of A, the homeowner’s monthly payment dropped to $1931.61, A SAVINGS OF $810.82. We say it all the time, but this is literally the difference between ultimately getting foreclosed on and keeping your home.

The rate will gradually increase over the next 5 years from 2% to 5% where it will remain fixed until the loan is paid off in full.

The old payment on the loan was $2,266.23 per month. At a savings of $1,041.39 in the first year, they will now be paying $1,224.84 per month.

When people ask us whether or not loan modification really works, it’s stories like these that prove it can.

When you are in the middle of a crisis where you are in the process or under the threat of losing your home the first thing you look for is help. When I personally experienced this threat I was able to turn to {company name withheld} to provide me with understanding and relieve to provide the strength to cope with the financial challenges I faced.

My home mortgage was adjustable and the date for readjustment was just a few short months away. I had made over 50 calls to my mortgage company and received so many different answers of what to do and no results that I knew it was time to call in professionals that could save my home for foreclosure.

The very first person I talked to from {company name withheld} was knowledgeable, understanding, compent and helpful. He put me touch with a personal home finance consultant that was able to answer all of my questions and provide me with the peace of mind that only comes from knowing that you have help to face the challenges and bureaucracy that you are forced to deal with when working to save your home financially. My loss mitigation manager held my hand through the entire process. She always a email and or a phone call away. She was understanding, supportive, prompt and knowledgable, without her I could not have stayed sane through this ordeal. I can not say enough about the dedication and support she offered me throughout this entire crisis.

Without the assistance of {company name withheld}. I might have lost my home. Calling {company name withheld} provided me with the peace of mind, the support and the professional help that I needed to save my home and provide me with a fixed rate mortgage that I can afford for 30 years.

Sincerely,

Rescued Home Owner

Our loss mitigation department recently won a case that dropped a client’s principal balance by $50,924.71. The interest rate dropped from 8.35% to 3% on a 274 month term. The monthly payment dropped by $434.48.

The lender in this case was Chase and it was a second mortgage.