Home Loan Modification Tips
By Matthew Bartlett
In the current market many homeowners are considering a home loan modification. However, to modify your current home loan certain criteria must be met.
1. You must document all of your current income and savings information. Making too much or too little income may disqualify you for a loan modification.
2. You must have no equity in your home or be upside-down (owe more than home is worth) for your lender to be willing to work with you.
Beware of the lender who says they are unable to work with you unless you are in default. This does not give you justification to stop making your trust deed payment. The truth is few homeowners are being helped who are in default.
Anyone that claims they are a loan modification specialist, be careful they may infact be a mortgage broker. California law requires non-attorneys to register as Mortgage Foreclosure Consultants and they may be liable for any damages they may cause you. They are required to enter into a contract with you, & if they do not have a contract they can email to you, then do not work with them.
You should also know that California law requires that lenders work with you, even if you are not currently in default. Just the possibility that you will face foreclosure in the future will be enough. If your lender refuses to help you because you are not in default, simply take down their name and send a certified letter with return receit requested. Your letter must describe the conversation and the employees refusal to assist you. Also inform them they have 15 days to respond in writing if they disagree with your statement. At this point contact your attorney immediately.
Lastly, because I'm not an attorney I recommend that homeowners considering a home loan modification work with an attorney who speacilizes in Real Estate law. Your attorney will speak directly with your lenders legal department, avoiding the normal run around.
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