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Regardless of where you are at financially, it is almost never too late to avoid losing your home to foreclosure. Qualified loan modification attorneys know that while it is easy to lose hope and fall into a place of inaction, you have many tools at your disposal.

Options

Contact your existing lender and see if you can get a forbearance, a payment plan or a deed in lieu of foreclosure. A forbearance is an agreement between the lender and the borrower that reinstates the delinquent loan through the payment of a lump sum or a schedule of payments over a period of time. A payment plan is similar to forbearance; in some cases, the lender may agree to a short term payment plan if you can prove you’ve had a hardship (loss of a job, medical bills, etc.). A deed in lieu of foreclosure is a voluntary transference of title to the lender. Most often, this is used as a last ditch effort by the homeowner to avoid the negative consequences of foreclosure.

The problem with all of these options is that they require a great deal of cash on hand, something you most likely do not have available. Foreclosures can be a challenging situation because most people facing foreclosure are not simply lazy people who forgot to pay a bill, they are hardworking people who are facing some sort of financial crisis. These might be options if you have $10,000 or $20,000 on hand, but odds are you do not. With a deed in lieu of foreclosure, the ultimate problem is you no longer own the home, and so now you’ve lost any equity in the house and you are not in control

Other options include refinancing, although that depends upon your credit history which could have taken a massive hit from your financial problems. If you do not have an outstanding credit history, or if your financial challenges are more than short term, a refinancing probably will not happen. A short sale is an option, although there is no guarantee that the lender will forgive whatever debt remains from the short sale. There is also always bankruptcy, but there are so many challenges before, during and after a bankruptcy that it can be a complete waste of time. A bankruptcy will stay on your credit history for up to a decade and provide nothing but headaches during that time. Even afterwards you can face financial challenges, career challenges and legal challenges stemming from the bankruptcy.

Quite possibly your best option when facing foreclosure is a California loan modification. A loan modification is a change of the terms of the original mortgage loan; the change could be to the interest rate, the length of the mortgage, the principal balance, the late fees or some other part of the original agreement. To get a loan modification, you can attempt to deal with the lender yourself or hire a California loan modification attorney to negotiate on your behalf. A loan modification attorney will often get a quicker response from a lender because he or she will have the law on their side. A lender will consider a loan modification when foreclosure is eminent and the borrower’s income has been decreased, but if the borrower will be able to keep paying the mortgage at a lower monthly rate.

Visit us at http://www.loanmodificationhelpcenter.org/ or call 800-359-6941.

Legal Disclaimer

The information contained herein is provided for general information and advertising purposes only and is not intended to convey a legal option nor legal advice for any particular case or situation. Nothing in this article shall create an attorney-client relationship. Nothing sent to this law office via e-mail shall constitute an attorney-client relationship. Nothing contained in this article shall be construed to be a guarantee or prediction of result. Prior results are provided for general information purposes only and do not guaranty, warranty or predict a similar outcome with respect to any future matter. Results achieved depend on individual circumstances and not everyone will qualify or be successful in restructuring their mortgage loan.

A retiring Chicago city employee had her home loan with CitiMortgage modified to 2 percent on a 40 year amortization and granted a two month payment holiday to rebuild reserves. Her husband has social security and a small pension but She was facing a large drop in pay as her retirement date of June 30, 2009 was fast approaching.

She would be receiving a pension at only 40% of her prior pay and she didn’t have enough social security quarters to draw her own benefit. They had never been late on their mortgage so making a case for not being able to afford it might look opportunistic. I was very reluctant to take on this client because 31% of their future combined income was so low that I just couldn’t imagine CitiMortgage coming through for them so I advised that they try to sell the property while I made their plea for Making Home Affordable (MHA) with CitiMortgage.

They had listed their home with a local realtor and weren’t able to get any bites even at what they owed so this was a scary situation all the way around. I have only the highest regards for CitiMortgage loss mitigation department because they were willing to work on preventing a train wreck rather than watch idly by. This was a fairly aggressive loan mod application because our client maintained her perfect credit and headed off future problems by contacting us in advance of her drop in pay. See www.illinoismortgagemods.com to read more typical results.

A St. Charles residential contractor gave up on waiting for building to rebound and retired to a small carpentry pension and social security. I prepared his Chapter 7 bankruptcy so that he could strip away all his other debt and try to hang onto his home. I then submitted a mortgage modification request to Chase/EMC and they very generously modified his subprime loan into a prime loan and cut his payment by 50%. There is now no question he will be able to afford the payments going forward and enjoy retirement as a homeowner.

It could be as low as 2% on a 40 year amortization. Your modified payment will depend primarily on your Current Income. Therefore, lower income means lower rates. Interestingly, the traditional risk variables that would ordinarily determine your interest rate when applying for a loan are turned on their head with the Making Home Affordable (MHA) loan modification program.

Can you imagine going back a couple years and having a banker say to you, “We could give you a lower rate if you were delinquent or even if you just made less money but it appears that you can afford to pay more than your neighbor so that’s what we are going to charge”. Homeowners that are interested in benefitting from MHA shouldn’t put off applying for the home-equivalent of “Cash-for-Clunkers”.

The auto industries 3 Billion dollar bucket of money is almost gone and mortgage servicers have really gotten their act together on participating in MHA so even the much larger 75 billion dollar bucket will tap out.

There are gotchas within MHA guidelines just like there were with Cash-for-Clunkers but qualifying candidates should come out of it with a payment at 31% of their gross income even if that means a 6 month delinquent borrower gets reset as low as 2% on a 40 year amortization! If you want to see if you may qualify for a MHA loan modification then contact your mortgage servicer, a real estate attorney or use the free online evaluation at: www.illinoismortgagemods.com

Almost every lender/servicer cautions homeowners against paying third parties to assist with their loan modification applications. Every participating lender in the Making Home Affordable (MHA) loan modification program is capable of working directly with their borrowers to process these applications without third party assistance.

There is also free government loan counseling help for homeowners that are struggling to work directly with their lenders. On the other hand, many of my clients first tried unsuccessfully on their own and were then surprised at how much quicker and better the results were when I was advocating for their application. I have a Bartlett client that was told he did not qualify for a MHA loan modification by both his servicer (National City) and a government counselor. I was able to get him into the MHA program in less than a week.

I was able to get a Des Plaines client a mortgage modification with Washington Mutual on their rental home in Florida even though rental properties aren’t even included in the MHA program. Whichever route you go, make sure not to pay large upfront fees and that loan modification charges are for obtaining a loan modification not submitting your application. In Illinois, make sure that any upfront fees are for retaining a real estate attorney. If you want to explore retaining a real estate attorney to process your mortgage modification application correctly then use the free online evaluation at:www.illinoismortgagemods.com

The auto industries 3 Billion dollar bucket of money is almost gone and mortgage servicers have really gotten their act together on participating in MHA so even the much larger 75 billion dollar bucket will tap out. There are gotchas within MHA guidelines just like there were with Cash-for-Clunkers but qualifying candidates should come out of it with a payment at 31% of their gross income even if that means a 6 month delinquent borrower gets reset as low as 2% on a 40 year amortization! If you want to see if you may qualify for a MHA loan modification then contact your mortgage servicer, a real estate attorney or use the free online evaluation at: www.illinoismortgagemods.com

Your spouse lost her job, your wages were cut, you got behind on the mortgage, then got even further behind and now you have received a foreclosure notice in the mail. You start to question whether or not you have options, and whether or not it is worth even putting up a fight any longer.

Truth is, it is not too late. A loan modification could help you, and a California home loan modification attorney could work with you to stop that foreclosure dead in its tracks. The common myth about loan modifications is that once the wheels of foreclosure have begun to spin there is nothing you can do to stop them. However, as long as you still reside in the home, meaning that you have not voluntarily abandoned it, or that the home has not been sold at auction, you may still have time to work out a loan modification with your lender. The sooner you take action, the more options you will have available to you. Time is of the essence, but you must contact your California home loan modification attorney to see what your options are.

Demonstrating a good faith effort by contacting your lender can often buy you extra time. Banks and lenders suffer a financial loss on most foreclosures, and are willing to discuss loan modifications, even late into the foreclosure process.

California loan modification attorneys understand the complex nature of loan modifications, and have intimate knowledge of lenders, banks, the foreclosure process and other options available to you. Without this knowledge, the sense of hopelessness associated with foreclosure may lead you to make a poor decision. Truth be told, foreclosure is only a term, and until your home is auctioned off (or until you walk away) you are still in control.

In fact, loan modifications are becoming so vital to the real estate industry, banks, lenders, mortgage companies and America in general, that numerous business associations are calling for greater access to them. For example, the American Society of Appraisers is calling for more loan modifications throughout the country. Various industries are calling for the same thing, because loan modifications are keeping people in their homes. Hardly anyone is well-served by millions of homes going into foreclosure, leaving people on the street, living with their parents or without a hope.

There are tens of thousands of stories about people living in California who were able to stay in their homes, avoid foreclosure and live there they wanted to. One small business owner had prostate cancer and fell eight months behind on his mortgage on a house he had owned for 20 years. A California loan modification attorney stopped the foreclosure auction, cut his interest rate by more than 7% and the monthly payment by more than $1,800. Another story about a mother of two from the Inland Empire who was also a widow was almost heartbreaking, until a California home loan modification attorney helped her cut her payments in half.

Stories such as this are true, and could be your story, but only if you act quickly and find out what your options are.

Visit us at http://www.loanmodificationhelpcenter.org/ or call 800-359-6941.

Legal Disclaimer

The information contained herein is provided for general information and advertising purposes only and is not intended to convey a legal option nor legal advice for any particular case or situation. Nothing in this article shall create an attorney-client relationship. Nothing sent to this law office via e-mail shall constitute an attorney-client relationship. Nothing contained in this article shall be construed to be a guarantee or prediction of result. Prior results are provided for general information purposes only and do not guaranty, warranty or predict a similar outcome with respect to any future matter. Results achieved depend on individual circumstances and not everyone will qualify or be successful in restructuring their mortgage loan.

Over the last two years, tens of millions of people have learned far more about loan modifications than they ever thought they would. The economic crisis and real estate crash forced people caught in difficult situations and overwhelming mortgages to look for their best options to keep their home. Foreclosure signs littered entire neighborhoods, and the state of California was thrown into a tale spin from which is has not yet recovered.

The question then becomes “how can I keep my home in spite of everything that’s happening?” The answer might be different for everyone, but one thing is for sure, a California loan modification attorney might just be your new best friend. It has become clear that Wall Street’s interference with the real estate industry has caused more chaos than every before. Entire neighborhoods used subprime mortgages to buy their homes, and as a result those neighborhoods are at risk of total collapse.

Contrary to popular belief, loan modifications have been around for a long time, helping people throughout California, and the rest of America, stay in their homes. Yet, since our current economic crisis has led to so many foreclosures and bankruptcies, homeowners, politicians and even lenders are trying to find the best way to get a loan modification.

In order to qualify for a loan modification in 2009, here is some information you might want to know:

Every creditor and lender has their own loan modification guidelines. For example, the loan modification process at Wells Fargo might be completely different than the one at Washington Mutual. It’s vital that you spend time learning your lender’s criteria, and how their loan modification application works.

Learn about your debt ratio. A debt ratio lets you know how much you owe versus your monthly income. Your lender will use this information to determine the new target amount of your monthly mortgage payment.

Your disposable income is important. You are going to have to take stock of how much you spend each month, if you haven’t already. Loan modification applications include a financial statement which represents a complete breakdown of how much money you bring in every month and what your expenses are. The person applying for the loan modification has to show all of his or her monthly bills against the monthly income in order to prove it’s possible to continue to make monthly mortgage payments at a lower rate.

Hardship letters are an important part of the process. Possibly the most important part of the loan modification process is the hardship letter which details your explanation of the financial situation you find yourself in. It also explains why you want to keep your house and your future plans. All of this will give the lender a clear picture of your situation.

As you can see, the loan modification process is not simple, and in fact it requires a great deal of preparation, research and knowledge to execute properly. Contact a loan modification attorney today to help you carry out your loan modification application in the best way possible.

Visit us at http://www.feldmanlawcenter.com or call 800-588-0425

Legal Disclaimer

The information contained herein is provided for general information and advertising purposes only and is not intended to convey a legal option nor legal advice for any particular case or situation. Nothing in this article shall create an attorney-client relationship. Nothing sent to this law office via e-mail shall constitute an attorney-client relationship. Nothing contained in this article shall be construed to be a guarantee or prediction of result. Prior results are provided for general information purposes only and do not guaranty, warranty or predict a similar outcome with respect to any future matter. Results achieved depend on individual circumstances and not everyone will qualify or be successful in restructuring their mortgage loan.

Author: Greg Feldman