FREQUENTLY ASKED QUESTIONS ABOUT LOAN MODIFICATIONS
What is a loan modification?
A loan modification is a mutually agreed upon modification to a homeowner's existing mortgage note(s) that allows a homeowner to stay in their home and avoid foreclosure of the property. The process does not involve refinancing.
What does the process of getting a loan modification entail?
The Following describes a "financial" loan modification where you submit your financials to the lenders. We do not normally do this type of loan modification but here is the process.
- Gather up all of your financial documents (debts and income) and loan file(s)
- Prepare a hardship Letter
- Sign a borrower's authorization that allows negotiation on your behalf
- Prepare a proposed loan modification form so your loss mitigation representative will know what you are seeking
- Send us all of this information to your loss mitigation specialist as soon as possible after enrolling
After you do your part, your loss mitigation representatice should do their part which generally consists of the following services:
- Review your documentation and prepare a financial profile for the lender (DTI statement)
- Draft a proposed loan modification
- Prepare a foreclosure loss analysis for the lender (which includes a broker opinion of value of the property)
- Consider conducting a forensic loan audit of your loan file(s) and draft a summary of our findings to present to the lender
- Submit this package to the lender for review - follow up aggressively and diligently on your behalf
- Negotiate for a favorable and meaningful loan modification
- Finalize any paperwork required to secure the loan modification
What does it take to qualify for a loan modification?
Typically one of the following factors should be present:
- You have a job but cannot keep up with the mortgage
- You have suffered a hardship (see below for a list of hardships)
- You have an adjustable rate mortgage that's about to adjust (ARM loan)
- You have an Option Arm Loan
- You have a Sub-prime loan that likely may be the subject of predatory lending
- You are upside-down on your property and one of the above factors exist
What are some of the recognized hardships that will help someone get a loan modification?
- Loss of Job / loss of income
- Divorce
- Death in Family
- Family Illness / Medical Bills
- Other hardship
What is the purpose of a loan audit?
A Forensic Loan Audit helps to identify potential infractions and violations committed by your lender and/or broker when your original loan was funded.
Typical Problems that may be uncovered in the loan audit process:
- No broker disclosures were made
- No RESPA booklet was ever given / NO CHARMS Booklet
- No good faith estimate (GFE) was given within three days of taking the loan application
- Two Copies of Notice of Right to Cancel not given to each borrower (or not completed)
- Three Day rescission period not provided for (client signs and loan funds on dame day on a non-purchase loan)
- FICO scores not properly disclosed
- Credit risk factors not disclosed
- Truth in Lending not provided within three days of taking the loan application
- Truth in Lending Statement does not accurately disclose the finance charges, APR, amount financed, or total of payments
- No payment schedule is included in the loan documents or the payment schedule is not accurate
- There is no ARM disclosure or the ARM disclosure in not accurate
- The loan contains a floor interest rate that is illegal in California
- Truth in Lending Notice of Right to Cancel is not filled out properly by the lender
- Documents are not properly signed or notarized
- There is no copy of the promissory note (it is unclear what entity is entitled to enforce the debt)
- There is no Final Hud-1 in the file or the Final Hud is not accurate
What happens if there are errors found in the loan files during the mortgage loan audit?
These errors cmay be used to leverage the lender into providing you with a meaningful loan modification. When you find Truth in Lending Errors in the Loan file or RESPA errors, or Disclosures problems, or signature problems, etc., the lender is automatically put on the defensive. If the note has been sold off and you are dealing with a loan servicer, this can be more difficult to leverage, but there is some case law that suggests assignee liability can be attached under certain circumstances.
Instead of begging for a loan modification you may have the leverage to literally demand a loan modification that will hopefully be meaningful in nature. If the lender refuses, a referral to a litigation attorney can always be provided. At that point the lender can explain to the judge all about their bona fide good faith defense or why the error is only "technical" in nature or why the borrower should not be so upset or how the error is not apparent from the face of the documents.
Are the lenders and banks really wanting to negotiate?
Yes. They are negotiating loan modifications every single day. The thing to keep in mind is that in most cases, the homeowner is upside-down on the property (meaning they owe more than the property is worth). The lenders realize that if they foreclose, in most cases they will be holding a piece of property that they will either not be able to sell, or that they will have to sell at a HUGE loss. Not to mention they will have to pay attorney fees to foreclose on the property. In the alternative, a loan modification is quicker and easier and allows the homeowner to stay in the home and allows the bank to continue earning interest on the loan.
What are some other options I have besides a loan modification?
- You can put your house up for sale
- You can pursue a short-sale with the banks
- You can hand over your deed (called deed in lieu of foreclosure)
- You can pursue a chapter 7 or chapter 13 bankruptcy (if you qualify)
- You can quickly find some tenants to help you pay the mortgage
- You can see if you are eligible to refinance
- There may be other government programs you can explore such as hope for homeowners or Obama's plan for home affordability.
How long does the loan modification process take?
Generally figure on anywhere from 30-120 days. The lenders are swamped. You have to give the process time to work.
Are there any guarantees the lenders will offer a loan modification?
No. There is no statutory or constitutional right to a loan modification. Which is why a mortgage loan audit is so important. The lender is not required to give you a loan modification as long as they have the legal ability to enforce the contract.
What are the major types of loan modifications I can expect?
When the lender is considering loan modification, the following types of loan modifications may be possible:
- Reducing your interest rate
- Fixing your interest rate
- Extending the Term of your loan
- Giving you a short term interest-only payment to get you back on your feet
- Reduce the principle loan balance
- Forgive late payments - loan forbearance
- Any combination of the above
- There are many other types depending upon your situation
What does it take to get started?
Simply give us a call at (877) 276-5084 and we can walk you through the process and share with you our loan audit process and how we seek a loan modification though the audit process before we sibmit financial documents.
Additional details and conditions apply. Contact us for a free initial phone consultation. You can also learn more about our attorney loan modification program at www.AttorneyMods.com
Because most of our loan modification work is done, by phone fax and email between us and you and the lenders we are able to serve our California clients in the following California Counties and Cities
Alameda
Albany
Berkeley
Dublin
Emeryville
Fremont
Hayward
Livermore
Newark
Oakland
Piedmont
Pleasanton
San Leandro
Union City
Amador
Amador City
Ione
Jackson
Plymouth
Sutter Creek
Chico
Gridley
Oroville
Paradise
Angels Camp
Colusa
Colusa
Williams
Antioch
Brentwood
Clayton
Concord
Danville
El Cerrito
Hercules
Lafayette
Martinez
Moraga
Orinda
Pinole
Pittsburg
Pleasant Hill
Richmond
San Pablo
San Ramon
Walnut Creek
Crescent City
Placerville
South Lake Tahoe
Clovis
Coalinga
Firebaugh
Fowler
Fresno
Huron
Kerman
Kingsburg
Mendota
Orange Cove
Parlier
Reedley
San Joaquin
Sanger
Selma
Orland
Willows
Humboldt
Arcata
Blue Lake
Eureka
Ferndale
Fortuna
Rio Dell
Trinidad
Imperial
Brawley
Calexico
Calipatria
El Centro
Holtville
Westmorland
Inyo
Bishop
Kern
Arvin
Bakersfield
California City
Delano
Kern County
Maricopa
McFarland
Ridgecrest
Shafter
Taft
Tehachapi
Wasco
Avenal
Corcoran
Hanford
Lemoore
Lake
Clearlake
Lakeport
Susanville
Los Angeles
Agoura Hills
Alhambra
Arcadia
Artesia
Azusa
Baldwin Park
Bell
Bell Gardens
Bellflower
Beverly Hills
Bradbury
Burbank
CalabasCarson
Cerritos
Claremont
Commerce
Compton
Covina
Cudahy
Culver City
Diamond Bar
Downey
Duarte
El Monte
El Segundo
Gardena
Glendale
Glendora
Hawaiian Gardens
Hawthorne
Hermosa Beach
Hidden Hills
Huntington Park
Industry
Inglewood
Irwindale
La Canada-Flintridge
La Habra Heights
La Mirada
La Puente
La Verne
Lakewood
Lancaster
Lawndale
Lomita
Long Beach
Lynwood
Malibu
Manhattan Beach
Maywood
Monrovia
Montebello
Monterey Park
Norwalk
Palmdale
Palos Verdes Estates
Paramount
Pasadena
Pico Rivera
Pomona
Rancho Palos Verdes
Redondo Beach
Rolling Hills
Rolling Hills Estates
Rosemead
San Dimas
San Fernando
San Gabriel
San Marino
Santa Clarita
Santa Fe Springs
Santa Monica
Sierra Madre
Signal Hill
South El Monte
South Gate
South Pasadena
Temple City
Torrance
Vernon
Walnut
West Covina
West Hollywood
Westlake Village
Whittier
Chowchilla
Madera
Marin
Belvedere
Corte Madera
Fairfax
Larkspur
Mill Valley
Novato
Ross
San Anselmo
San Rafael
Sausalito
Tiburon
Mariposa
Mendocino
Fort Bragg
Point Arena
Ukiah
Willits
Merced
Atwater
Dos Palos
Gustine
Livingston
Los Banos
Merced
Modoc
Alturas
Mono
Mammoth Lakes
Monterey
Carmel
Del Rey Oaks
Gonzales
Greenfield
King City
Marina
Monterey
Pacific Grove
Salinas
Sand City
Seaside
Soledad
Napa
American Canyon
Calistoga
Napa
St. Helena
Yountville
Nevada
Grass Valley
Nevada City
Truckee
Orange
Anaheim
Brea
Buena Park
Costa Mesa
Cypress
Dana Point
Fountain Valley
Fullerton
Garden Grove
Huntington Beach
Irvine
La Habra
La Palma
Laguna Beach
Laguna Hills
Laguna Niguel
Lake Forest
Los Alamitos
Mission Viejo
Newport Beach
Orange
Placentia
San Clemente
San Juan Capistrano
Santa Ana
Seal Beach
Stanton
Tustin
Villa Park
Westminster
Yorba Linda
Placer
Auburn
Colfax
Lincoln
Loomis
Rocklin
Roseville
Plumas
Portola
Riverside
Banning
Beaumont
Blythe
Calimesa
Canyon Lake
Cathedral City
Coachella
Corona
Desert Hot Springs
Hemet
Indian Wells
Indio
La Quinta
Lake Elsinore
Moreno Valley
Murrieta
Norco
Palm Desert
Palm Springs
Perris
Rancho Mirage
Riversi
San Jacinto
Temecula
Folsom
Galt
Isleton
Sacramento
San Benito
Hollister
San Juan Bautista
San Bernardino
Adelanto
Apple Valley
Barstow
Big Bear Lake
Chino
Chino Hills
Colton
Fontana
Grand Terrace
Hesperia
Highland
Loma Linda
Montclair
Needles
Ontario
Rancho Cucamonga
Redlands
Rialto
Twentynine Palms
Upland
Victorville
Yucaipa
Yucca Valley
San Diego
Carlsbad
Chula Vista
Coronado
Del Mar
El Cajon
Encinitas
Escondido
Imperial Beach
La Mesa
Lemon Grove
National City
Oceanside
Poway
San Marcos
Santee
Solana Beach
Vista
San Francisco
San Joaquin
Escalon
Lathrop
Lodi
Manteca
Ripon
Stockton
Tracy
Arroyo Grande
Atascadero
Grover Beach
Morro Bay
Paso Robles
Pismo Beach
San Luis Obispo
San Mateo
Atherton
Belmont
Brisbane
Burlingame
Colma
Daly City
East Palo Alto
Foster City
Half Moon Bay
Hillsborough
Menlo Park
Millbrae
Pacifica
Portola Valley
Redwood City
San Bruno
San Carlos
San Mateo
South San Francisco
Woodside
Santa Barbara
Buellton
Carpinteria
Guadalupe
Lompoc
Santa Barbara
Santa Maria
Solvang
Santa Clara
Campbell
Cupertino
Gilroy
Los Altos
Los Altos Hills
Los Gatos
Milpitas
Monte Sereno
Morgan Hill
Mountain View
Palo Alto
San Jose
Santa Clara
Saratoga
Sunnyvale
Santa Cruz
Capitola
Santa Cruz
Scotts Valley
Watsonville
Shasta
Anderson
Redding
Shasta Lak
Sierra
Loyalton
Siskiyou
Dorris
Dunsmuir
Etna
Fort Jones
Montague
Mount Shasta
Tulelake
Weed
Yreka
Solano
Benicia
Dixon
Fairfield
Rio Vista
Suisun City
Vacaville
Vallejo
Sonoma
Cloverdale
Cotati
Healdsburg
Petaluma
Rohnert Park
Santa Rosa
Sebastopol
Sonoma
Windsor
Stanislaus
Ceres
Hughson
Modesto
Newman
Oakdale
Patterson
Riverbank
Turlock
Waterford
Sutter
Live Oak
Yuba City
Tehama
Corning
Red Bluff
Tehama
Trinity
Tulare
Dinuba
Exeter
Farmersville
Lindsay
Porterville
Tulare
Tulare
Visalia
Woodlake
Tuolumne
Sonora
Ventura
Camarillo
Fillmore
MoorpaOjai
Oxnard
Port Hueneme
Santa Paula
Simi Valley
Thousand Oaks
Ventura
Yolo
Davis
West Sacramento
Winters
Woodland
Yuba
Marysville
Wheatland
Note: Loan modification work is primarily driven by phone, fax and email with you and the lenders.
As a consequence we are able to serve Arizona loan modification clients in the following Arizona cities:
Tucson
Mesa
Glendale
Chandler
Scottsdale
Gilbert
Tempe
Peoria
Yuma
Surprise
Avondale
Flagstaff
Lake Havasu City
Goodyear
Sierra Vista
Prescott
Oro Valley
Bullhead City
Apache Junction
Prescott Valley
Casa Grande
El Mirage
Marana
Kingman
Buckeye
Fountain Hills
San Luis
Nogales
Florence
Douglas
Queen Creek
Maricopa
Payson
Sahuarita
Paradise Valley
Chino Valley
Eloy
Sedona
Cottonwood
Camp Verde
Show Low
Winslow
Somerton
Safford
Coolidge
Globe
Page
Bisbee
Tolleson
Youngtown
Wickenburg
South Tucson
Guadalupe
Holbrook
Snowflake
Cave Creek
Benson
Thatcher
Litchfield Park
Eagar
Pinetop-Lakeside
Taylor
Colorado City
Dewey-Humboldt
Willcox
St. Johns
Carefree
Clarkdale
Quartzsite
Parker
Superior
Williams
Clifton
Kear
Pima
Springerville
Star Valley
Gila Bend
Wellton
Miami
Huachuca City
Mammoth
Tombstone
Fredonia
Patagoni
Hayden
Dunca
Winkelman
Jerome
This is an advertisement and communication pursuant to State Bar Rules. The Law Offices of Steven C. Vondran is licensed in California and Arizona. We only seek to represent clients in these states.
Arizona Clients:
2415 E. Camelback Road, Suite 700
Phoenix, AZ
85016
(877) 276-5084
California Clients:
620 Newport Center Drive, Suite 1100
Newport Beach, CA 92660
(877) 276-5084
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Hi my name is Jaime i live at 798 East Park ave. San Jacinto ca, 93583. With my family, i was wondering about a loan modification for my mortgage, since my wife lost her job and we wont be able to keep up with the bills soon and we dont want to lose our house. We called other companies for loan mods but they want an upfront fee of $3,500 just to get started and they dont gauranty the work. i feel that its too much money and would only throw it away if they dont do a good job, just too much of a risk. Our bank is wells fargo and we owe @260,00 on a home that is worth $155,00 such looked it up on zillow.com. can you please help us, thank u Jaime.