Loan Modifications

In the last several months, I have come across clients who have fallen behind on their mortgage and are now faced with some options, like whether to obtain a loan modification.

These are difficult times, and often during times of pressure, rash decisions are made without fully understanding the consequences of our choices. There's a great blog by Mandelman about this subject.
Bascially, Mortgage loan modifications assist home owners stay in their properties by restructuring present mortgages to minimize month-to-month payments. Even though mortgage modification loans are beneficial to debtors, loan providers take advantage from them as well.

Some Basics for a loan Modification are :
Start the loan modification procedure early. Your lender doesn't want to foreclose on your house, but it will follow common protocol after you default on your mortgage loan installments. The U.S. Department of Housing and Urban Development states that borrowers should speak to their mortgage loan companies and request modification of their residence loans as soon as house loan payments become a dilemma .
-- Avoid loan modification scams. Be cautious of any business or individual that offers to help "streamline" your home loan modification process. Even though reputable organizations exist that can offer you assistance, con artists abound that are much more than prepared to take your money, or worse, your property.
-- Have proof of your monetary scenario.
-- Stay in contact with your loan company. If you submit your Loan Modification application and monetary paperwork however do not hear something from your loan company for several weeks, call the bank and inquire about the status of your application.
-- Get it in writing. If a bank representative called to inform you that your loan modification request was accepted, hold off on celebrating until you receive the information in writing . Your loan company isn't required to honor any statements produced by its representatives over the telephone. Continue making your previous mortgage payment until the financial institution sends you something in writing notifying you of your new loan terms.

Should you hire a lawyer to help you with this?
"When a homeowner hires an attorney to help negotiate a loan modification, that attorney is not going to being made to feel ashamed, guilty, or afraid… the borrower can be made to feel all of those things and more, but the lawyer, not so much. He or she is a hired gun, if you will. That’s why the banks don’t want homeowners to be represented, and why they want homeowners to call them directly." Well, said, Mandelman.