Loan Modification Success! Here Are Ten Essential Tips!
Loan modification success! Here are ten essential tips!
1. Call your Lender: You need to ask some important questions before you start this process; 1.Do I have to miss any loan payments? If so, how many and what happens if I start paying again during this process? 2. How long does this process take average? 3. Which department processes and approves your loan modifications? 4. If you were me, who would you talk to and work with that would give you the best chance to get approved? 5. What criteria does your company use to make their decision to approve a loan modification? 6. Would I be better off just selling my home for less than I owe on it? 7. If you were me, what would you do? You can feel free to add or subtract from these as you wish. Keep one thing in mind when making these calls, you get alot more with honey than you do with vinegar! Even if you do not hear what you want to hear stay calm and respectful even charming if you can!
2. Make sure to talk with the correct department. There are a number of titles for these departments now, "Home Retention Department", "Loss Mitigation Department", etc.
3. Ask them for a detailed list of what is required for your loan modification package. Be sure top ask the person that you talk with for any tips regarding your application and your supporting documentation. Ask them what their company's criteria is for approving loan modifications. Take notes!
4. If they require that you fax your loan modification package to them, ask how soon and with whom you can confirm they received your package. Hint: Put your name, loan number and property address on the top, bottom upper left or right side of each document!
5. When you write your hardship letter be detailed and accurate: Make sure that you emphasize that this hardship is something that has happened to you not something you could have planned for. Don't be humble or private, let them have the details as painful as they might be to relive and put on paper to a stranger. Please remember, the person on the other end of this letter does not know you so you need to be specific and let them know what has happened even if it is embarrassing! You need this person on your side...they are making a decision that will determine much of your and your family's financial future! If your credit report shows that you started missing payments three months ago, make sure you explain what you did to make your payments on time even though you lost your job ever a year ago! You probably liquidated everything you had before you started missing payments make sure you explain in detail and as accurate as possible what you did to "stay afloat".
6. Make sure your copies are as quality and legible as possible! Even is it costs you extra, you want to make sure that the underwriter, the decision maker on your loan modification has no lame excuse like the quality of the print of your documents that make up your loan modification package!
7. Fill in the blanks! If you have a bank account that you transfer money out of and into another account of yours make sure you provide the most recent statements even if there is nothing in the account! If the underwriter sees an account indicated that you use on your bank statement and you don't include it, they will tend to decline you because they may think you are not being honest or forthright or you are hiding something or all of the above! If you have income on your tax returns that is from an account that no longer exists, provide documentation showing the liquidation of the account and where the money went...chances are it went to make your payments while you had no other income coming in but document it anyway! In fact, if you are not sure document it...whatever it is! If you show you own a rental property of a small business, explain and document, document, document!!!
8. Have a friend or someone who is detail oriented look over your loan modification package and ask them to find any questions or inconsistencies! This can be invaluable!
9. Ask if your lender has a location near you where you can sit with a loan modification advisor or manager that you can meet with and submit your package to for their review and suggestions! If the answer is no ask if they have a homeowner assistance event coming up in your area. If not, ask if they can refer you to a HUD approved counselor in your area that you can meet with and that can review you package to make sure it give you the best chance of success!
10. Follow up, follow up, follow up! Take a spiral notebook and make a schedule where you call weekly, preferably the same day and time each week. When you call, write down who you talk to and what they tell you. Each time you call, let the person you get know that you called last time and this is what you notes say you were told! Very important! This way they know that someone in the industry is coaching you! Make sure that you stay calm and respectful and try to be charming! If you do not get what you want, ask respectively to speak with their supervisor! Stay on them! You are the only person who cares about whether this is a success or not!
Be prepared, there are a very large percentage of loan modifications, some reports say 85% plus, that are declined! If you are declined, this is not a personal insult it is a business decision made by a person that has been hired to protect the lender against risk. Ask if there is anything in your loan modification package that makes your loan modification too much of a risk for the lender. Listen to their response and see if you can correct what they think poses a risk to the lender.
If all else fails and you have decided to sell your home, call me 760-802-9500 right away and we will go to work!