Tag: Modification

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Mortgage

How To Qualify For Obama's Mortgage Modification Stimulus

Have you missed some mortgage payments and are facing defaulting on your home loan, or home foreclosure? If so, the Government and President Obama have enacted two options to help millions of homeowners refinance or modify their existing mortgages into new ones with a 4% fixed rate interest rate. Here is some things to expect from this plan:

-The mortgage must have less than $ 729,500 remaining on the due balance.

-The mortgage must have been signed on and completed prior to January 1st 2009.

-The home to be refinanced must be lived in as a primary residence by the owner.

-Your personal income can (and will be) be verified using tax returns and pay stubs.

-A letter of "Financial Hardship" written by and signed by you, in your own handwriting.

-The homeowner must agree and go to free credit counseling if their monthly household debts exceed 55% of the homeowners gross monthly income.

Here are some options Mortgage Lenders and Banks can offer using this plan:

-Your monthly mortgage payments will be lowered to no more than 31% of your gross monthly income.

-Interest rates can actually go to as low as 2% but typically will be closer to the 4% range.

-Their will be no fees or other costs for performing a home mortgage modification or refinance.

-Banks and mortgage lenders could potentially set up balloon payments at the end of the mortgages in order to recover their money from offering such low monthly payments. This payment needs to be paid off prior to selling or refinancing your home another time.

-For every year of on time payments, the Government will reduce the amount of principal you owe on your home by $ 1,000 up to a maximum of $ 5,000 just for making payments on time.

-The banks and mortgage lenders can adjust the interest rates after a 5 year period. This plan is to help homeowners recover from their financial troubles.

-This plan can only be used one time to refinance or modify your home loan.

If you have remained current and up to date on your monthly mortgage payments, and are not able to modify your home loan, then refinancing may be the best alternative option. Refinancing into a fixed 4% interest rate with President Obamas plan can be very easy. Here are some requirements for this:

-Again, the home must be a primary residence.

-Proof of income to support the new mortgage and other debts is required.

-Cash taken out from the new home loan can not be used to pay other loan debts you may have.

-The home loan must be financed by Fannie Mae or Freddie Mac.

-The mortgage interest rate will be determined by the national average and points may be added on as well as fees charged.

-The new mortgage will be either for 15 or 30 years with a fixed rate of interest.

-The banks low interest offers may expire after an initial 5 year period.

-Homeowners can even refinance if they have a mortgage worth up to 5% more than their homes current value.

Home mortgage refinancing or modification , especially using this plan will benefit millions of homeowners. The reports are coming back already and the average homeowner is saving hundreds every month by taking advantage of this plan and refinancing their home mortgage.

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Mortgage

Were You Rejected For Refinancing? Learn How Mortgage Modification Can Help

Homeowners who are facing the precarious situation of a likely foreclosure are often in a stat of panic and are willing to take any measure to save their homes. Inevitably, most of these people turn to refinancing, unfortunately if foreclosure is imminent it is obvious that mortgage payments have been missed or the homeowner is at least 90 days late. In both these situations a person would be ineligible for refinancing because these will reflect badly in your credit score and you need an almost flawless credit rating to procure refinancing.

It can be a heart wrenching experience to find that you have been denied of refinancing and that you may not be able to save your home. However what most homeowners fail to realize is that there is another solution besides refinancing: home loan modification.

Mortgage modification is essentially the renegotiation of the existing terms of your loan. Home loan modification is designed to help homeowners by making the monthly mortgage payments more affordable. Since the lending institution is already aware of your financial condition when granting you a mortgage modification, your credit score does not play a role in the process of procuring a home loan modification.

The lender and the borrower may renegotiate several terms under mortgage modification these may include:
o Reducing the interest rate and keeping it fixed for a period of one to three years or more.
o Writing off some of the principle amount or certain penalties that have been levied
o Extending the tenure of the loan.
o Or a combination of all of the above.

For homeowners who are faced with dire financial adversities home loan modification is a good option to save their homes. Not only will be able to retain your house through mortgage modification but you will also be able to profit from an eventual boom in the real estate market.

You can apply for a home loan modification on your own or you could avail the services of an attorney or a company that can negotiate the mortgage modification with the lender on your behalf.

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Mortgage

Chase Mortgage Modification and Refinancing Options

Chase is one of the select mortgage lenders who is approved from the Government to take part in the stimulus plan for homeowners. This plan allows homeowners to get a home loan modification or refinancing into an affordable monthly payment. Chase is fully prepared to offer this plan to homeowners right now.

This is all possible because of over $ 75 billion in Government funding to aid homeowners. Primarily targeted to help homeowners avoid foreclosure, or losing their home, this plan can help millions. Chase, along with only a handful of other lenders, has the tools, knowledge, and experience to help almost any homeowner. Now with this plan in place, they can help even more people.

Most of the $ 75 billion will be used to cover closing costs and financial risks mortgage lenders and banks, like Chase, take on when helping struggling homeowners. What this means for homeowners who are struggling is it has never been easier to get approved for a mortgage modification or refinancing . This may be just what homeowners need to avoid losing their home, and a whole lot of money.

With this bad economy and worse housing market, this plan is helping homeowners at a perfect time. Foreclosures and mortgage defaults are at an all time high, and no one benefits from that. Right now there is no excuse for a struggling homeowner to not try to get help. Literally millions of homeowners can use this plan for their own situation and get the answer they need to save a lot of money, or their home. Chase is ready, willing, and able to help. Homeowners need to take action, and contact Chase today.

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Mortgage

Mortgage Loan Modification Help – Why Your Lender May Ask For a Good Faith Deposit

Homeowners who have missed many mortgage payments and want to apply for a loan modification need to be prepared to make an initial payment to their lender. In some instances, when you apply for a mortgage loan modification, your lender may ask for a good faith deposit. You need to know about this possibility, because if you are not able to provide what your bank asks for, your loan modification application could be denied. What is this and why might your bank want it?

A mortgage loan modification good faith deposit is often requested by lenders when a borrower has not made any home loan payments for many months. A good faith deposit could be equal to a portion of the past due payments and the bank will ask for that amount as a condition to complete the loan modification. When and why will the lender ask for this?

Let’s say that you fall behind on your payments and do not pay anything for many months. You apply for a mortgage loan modification and prepare your financial statements detailing your income and expenses. These forms show your lender that you while you can’t afford the current high mortgage payment, you do have enough income coming in to pay your bills and can afford a new, lower modified mortgage payment. This is how you convince the bank that you are a good candidate for a loan workout. So if you haven’t made any payments at all for a few months, you should still have some reserves left over, right?

The HAMP guidelines require that all loan modification terms include an escrow or impound account for the property taxes and homeowners insurance. This means that each month you pay 1/2th of your annual tax bill and insurance bill to your lender. The bank then holds this amount in reserve, until it is time to pay the bill and they they pay it for you. This is to avoid default on your taxes and to make certain that their collateral is always insured.

If your taxes are due soon, and there is not enough money in your current impound account, or if you did not have one previously, you may be required to deposit a sum in order to start up the impound account. This is another reason why you may need to have some money set aside to finalize your mortgage loan modification. While back taxes can be paid for you and then that amount added to your loan balance, an impound account may require some upfront funds from you. Don’t let this be a reason to not be able to modify your loan!

Unfortunately, many homeowners spend the money that they would normally put towards their mortgage payment. Sometimes, that money that would have gone towards the house payment is used for other debts. But your bank wants to know that your home loan is your priority-that is why it is so important to hold onto some of the money that would have gone towards a mortgage payment. Being able to pay a good faith deposit to get your mortgage loan modification started could be the difference between help and losing your home. If your lender asks for a good faith deposit you need to be able to pay it, or you must have a very good reason for not having any money available and be able to document it. Try to put aside some money so that you will be able to pay a good faith deposit if your bank asks for it.

The federal program, HAMP, does not usually require a large upfront payment. Any missed payments can be added into the loan balance and included in the new modified payments. The Obama plan offers a very low affordable payment which is targeted to equal 31% of your gross monthly income. THis is a very good plan to apply for, and since it features standard approval guidelines it is recommended to prepare your application correctly to meet those guidelines.

There is actually a 4 step formula that the banks use to determine if a homeowner qualifies for the HAMP plan. You can take the frustration and confusion out of preparing your own application by using the Loan Mod Quick App software program-it actually does all of the calculations for you so you can be confident with your application. Whether you apply for HAMP or some other loan workout program with your lender, be sure you take a few hours to prepare your paperwork correctly for the best chance of approval.

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Mortgage

Mortgage Loan Modification Programs – Are They For Real?

I have a reputation — perhaps well deserved — among my friends and colleagues as being someone who knows a little bit about everything. I wouldn’t exactly say that I’m Cliff from cheers, but it’s safe to say that if someone is looking for an opinion about a subject that they don’t know much about they feel comfortable asking me.

Recently a new subject has come up, and so of course as I usually do I’ve done some research into it and found out what I could in order to help people who ask me.

What we’re talking about here are mortgage loan modification programs. There’s never been a greater need for this kind of thing than now. With the financial mess that we’re in, it’s no wonder that so many people are finding it harder and harder to make that monthly mortgage payment.

But are loan modifications for real? And what’s more, do they really help?

First, let’s adjust some of the reasons why people think they don’t work. Most of the negativity surrounding loan modifications stems from some early media reports that seemed to suggest that a lot of people who had successfully gone through them actually wound up back in financial difficulty just a few months later.

So let’s address that right up front. The problem with these reports, as I found out, is that they’re based on people who got loan modifications back before the economy totally tanked. Why does that matter? Because during that time, banks were not as willing as they are now to actually gave real relief.

So the people that they’re using for case studies in those reports, are not at all representative of the kinds of cases that you’re getting now, with the banks desperate to work with homeowners.

What you’re finding now are that loan modifications are making a much bigger difference in people’s lives than they were even six months ago. Banks are actually now willing to step up to the plate and offer real, and substantial, reductions in payment. Sometimes they even cut some of the principal off of your loan.

It’s not uncommon, with the right help behind you, to cut your payments by between 30% and 50%. Compare that to the token reductions people were getting just a few months ago, and you can see why loan modifications that are being done today are totally different than the loan modifications that were being done just a few months ago.

About 30 million homeowners qualify for a loan modification. Of course that doesn’t mean it’s necessarily right for you, but chances are if you’ve been affected by this economy at all, you probably have a good chance and should at least look into it.

Now, the issue is who do you turn to help? No, I don’t recommend that you try and do this on your own. This can be a tricky business, and having someone in your corner who knows the ropes is your best play here.

Below I have links to two resources that I think will be invaluable to you as you navigate the one modification maze. Please check them out right away. They’ll be a big help.

Finally, I do want to point out the loan modification can be used even if you’re worried that you might face foreclosure. This is not refinancing. You don’t need good credit to get along modification. You’re not applying for a new loan at all. You’re getting your lender to change the terms of your current one.

In fact, it may actually be easier to get a loan modification than to refinance, depending on what your credit looks like. But that’s why you need the help of someone whose experience and all of us to help you work through it.

I know this is been useful to you, and please don’t forget to check out the resources below. Thanks for reading and, as always, good luck!

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Mortgage

Mortgage Loan Modification – Should You Do it Yourself?

What Is The New Formula That Lenders Are Using?

There have been a lot of changes made recently to the formula that lenders use to determine if you ‘qualify’ for a loan modification. Many banks today have developed procedures to facilitate how they handle the thousands of loan modification requests that they receive on a regular basis. The credit crisis, compounded by the utter confusion coming out of Washington’s talking heads, has lead to a huge amount of uncertainty in the mortgage market. Specific solutions offered by the government, including the Hope for homeowner program, and the president’s newest program, the home affordable modification program, have proven to be difficult to implement, complex to understand, and in many ways impossible to succeed.

It is critical for you to take control over your own situation. The government is not going to help. In fact the new home affordable mod program is being viewed as only being able to help 5% of homeowners restructure their mortgage debt. Certainly not enough to stem the foreclosure tide. You can help yourself. I am a banking veteran with over 30 years in banking, finance, tax accounting, and mortgage origination. I have been around long enough to see that these quick fixes being thrown out by government bureaucrats will do nothing to fix the problem. I have also experienced first hand the difficulties my clients have had in just trying to get a bank on the phone let alone help them do a modification. However, a professionally designed system is now available to swing the door wide open for a person to take the reins and complete a loan modification with their lender. No, you don’t need to hire an attorney. Of course, lawyers will be quick to disagree with me, saying that only they can negotiate a good deal for you. This is not lets make a deal. The banks have very specific guidelines and policies that they must follow in order to complete a modification. There is no deal making involved. What IS involved is some calculating to determine affordability, income and debt ratio determination, and a bunch of fairly simple forms to fill out.

You see, most lenders had pretty much settled on a specific formula, which they used as a benchmark to determine whether they would consider modifying a loan. This formula was based on a specific debt-to-income ratio, which was customary in the industry.

That’s until a study done in 2008 that showed that 60% of all loans which were modified at the beginning of that year had re-defaulted! The rate of default for 2009 is higher than that unfortunately.

So the lenders had to make a change to their ‘formula,’ to prevent modifications of loans which were likely to re-default, while still giving a chance to worthy borrowers.

Remember however that nothing is certain except change itself! Because just when the banks had the process of modification of loans perfected, and they thought that their formula was perfect, the President went ahead and changed the formula.

On Wednesday, February 18Th, 2009, President Barack Obama unveiled his plan to help struggling homeowners.

In this plan, up to 9 million homeowners should be able to get their loans modified, either by Fannie and Freddie, or their existing lenders. This is the Home Affordable Modification program that I mentioned above.

However, the plan does not mandate compliance, but rather gives incentives to lenders and servicers to modify loans early.

So what does this mean for you?

Well for starters, you should review the complete guidelines which were released on March 4Th, 2009, to see if you qualify.

Secondly, since the modifications are still not mandatory, you must still know how to package your deal, so the lender says yes.

First, let me tell you that this is not Rocket Science! But you still to have a little “insider” knowledge to make it happen! Research the process and do it yourself!

Wishing you all the luck in your situation…

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Mortgage

Mortgage Loan Modification – Can You Do it Yourself?

The Treasury Department is encouraging homeowners to contact their lenders directly to apply for a loan workout. But homeowners are confused, how do you qualify for mortgage loan modification help? Is this something they can do themselves by contacting their lender or should they pay a company to represent them? How to get the information needed to make a wise decision?

Mortgage loan modification is Greek to most homeowners-and with good reason. In the past, loan workouts were only offered rarely and in the most dire of circumstances. Even then, the modified loans offered little in real relief to the borrower. Now, that has all changed. The housing crisis and mortgage meltdown has created a demand for streamlined solutions to homeowners stuck in loans they don’t understand and cannot afford. A mortgage loan modification can be a solution to struggling homeowners unable to refinance or sell their home.

But how do needy homeowners find out if they even qualify for a mortgage loan modification? Is it something they can do themselves or do they have to pay thousands to a company or attorney? How do you even know which company to hire? It is all very confusing and frustrating. The best step a homeowner can take is to learn as much as possible about the loan modification process. Before making a decision affecting home and family, some knowledge and preparation is the wisest move. There are a lot of companies out there ready to take money from vulnerable homeowners, and even attorneys have gotten into the act-with dubious advertising and overstated and unsubstantiated claims of success-what can a homeowner believe? Already struggling homeowners cannot afford to throw good money after bad with no results.

Mortgage loan modification is not brain surgery-but it does require some basic knowledge of the approval guidelines and how to complete the loan modification forms properly. Sitting down and figuring out a workable family budget so that the lender can verify the affordability of the new loan payments is the key to success. The banks are concerned about one thing-can the new payment be sustained so there will no future default? Homeowners who can prove this to their bank will have an excellent chance of being granted new and affordable mortgage terms.

An informed homeowner is hard to take advantage of. Knowledge and preparation is the key to being successful in obtaining a mortgage loan modification or hiring the best company to assist in the process. Borrowers who take the time to learn, research and prepare will find their time and effort rewarded. A mortgage loan modification is a solution many homeowners need to save their home and credit-and you can do it yourself successfully. Hundreds of thousands of borrowers have already received a loan workout using the Federal stimulus plan. Don’t waste thousands of dollars and months of your precious time-begin to today by learning the basics-then contact your lender and ask to be considered for a workout under the Home Affordable Plan.

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Mortgage

Mortgage Modification Tips – Modification of a Loan – Pros and Cons

Purchasing a home is one of the most important contributions to your net worth you can make in a lifetime. Thoughts of investing in your home and realizing the profit potential in recent years has come to a halt with the real estate market taking a turn for the worst. Homeowners are bombarded with unemployment and are reeling for a stable solution that won't tarnish all that they have worked for. The government has approved a mortgage modification program that benefits both banks and homeowners.

Realizing the mortgage modification pro's and con's is important knowledge when approaching your bank institute with the choice of loan changes. Mortgage modification can offer the opportunity to spread your loan out over a time period that will allow you to have the choice of a better monthly payment. This pro works for most homeowners struggling to make the payments that were negotiated at the time of purchase. Your financial institute will offer you rates that are slightly higher than your original purchase rate percentage. Some programs will increase gradually but may exceed the national limit, an evident con.

You are subject to reapply to meet certain criteria set specifically by your financial institution to qualify for a variety of programs. The pro to this attribute is your ability to lower costs due to loss of a job or retirement. The con to this feature, you will find that your loan life will be extended creating a feeling of endless payment and no personal possession.

Payment for your home, no matter the length of time, realizes that you are investing in an item that will be passed to another generation. Banks and the government have created programs that partner with the mortgage modification programs that offer additional funding for those who qualify. This pro will offer additional funds to reduce your total mortgage balance. The qualification process for those funds is very difficult and your past delinquency will be taken into consideration. This con disqualifies many homeowners due to the economic crunch that has caused some homeowners to reach foreclosure status multiple times.

It is recommended to speak with a modification expert before applying for modification of your loan. Mortgage loan modification offers different options for clearing your name and your investment. The mortgage modification pro's and con's mentioned may be a concern that you will discuss with your financial institution's expert. Keep in mind that there are programs that may be offered exclusively by a different institute. Check your qualification for those programs prior to deciding on final modification terms.

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Mortgage

Mortgage Loan Modification – Discover the 3 Different Programs Available to You to Modify Your Loan

There are various mortgage loan modification programs available to homeowners who are struggling to meet their mortgage repayments. However having a wide variety of choices can lead to you becoming confused and overwhelmed with all the information you have to take on board. Therefore in this article i would like to introduce you to the 3 main mortgage loan modification programs.

1) The Fannie Mae streamlined modification program. This mortgage loan modification program is openly available to those of you who have a mortgage that is either serviced or owned by Fannie Mae. I would hazard a guess that the majority of home loans fall into this category. Your mortgage payments will be lowered to 38% of your monthly income. This is done by either lowering your interest rate to as low as 3% or extending the term of your loan. Depending on how bad your circumstances are, you may even have some of your principal balance reduced.

2) The next program is the FHA partial claim mortgage loan modification. This will be available to you if your home is insured by the FHA. Usually if you are in arrears on your loan, another "deferred" loan is put in place to pay for these arrears. It is not until you decide to sell or refinance your home that you will have to make any payments to this new deferred loan.

3) Many individual lenders now offer mortgage loan modifications. In conjunction with the government, these lenders have agreed to lower your monthly mortgage repayments to a maximum of 31% of your monthly income. Once again this is achieved by either lowering your interest rate, extending the term of your mortgage or by reducing some of your principal balance. Although this is a government backed scheme, individual lenders may publish their own guidelines for approval to their mortgage loan modification program.

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Mortgage

Mortgage Modification 411 – Loan Modification Program

Firstly, what is a mortgage modification program? It is simply the modification of your loan structure to lower your payments. Banks have now introduced mortgage loan modifications as a way to minimize their foreclosure ratios.

Let’s get introduced to the Mortgage modification Program

This program is basically for those who are having trouble paying their monthly mortgage installments and now want to lower their payments. In order to be eligible for a Mortgage Modification you need to:

o Be owner of the mortgaged property

o Have a first mortgage originated on or before January 1, 2009

o Have a monthly payment of more than 31% of your Gross Monthly Income

o Have a mortgage payment that is unaffordable due to financial problems

If you meet all the required criteria, then you can apply for a loan modification.

Pros of modifying your mortgage loan

o Monthly mortgage payments are lowered

o After the loan is modified, and you make timely payments, then you get a “Success Incentive” that reduces the principal balance of your loan

o Modifications under the Home Modification program are free

o This program is basically designed for people who lack their timely payments or are on the verge of foreclosure.

Thus you can see how useful the mortgage modification program can be for those who are having hard time meeting their monthly payments. Lastly, beware of persons or institutions who ask you to pay fees in exchange for your loan modification-NO Charges should be made for a loan modification. Also, never make any payments to persons other than your mortgage service provider or an authorized official.

So, go learn about the different modification options available to you, begin the journey to modifying your loan and save yourself some of that ever so needed money. Good luck!