What You Need To Do To Get Yourself Qualified For A Loan Modification

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Services for Real Estate Pros with Real Estate Consultants

What You Need To Do To Get Yourself Qualified For A Loan Modification

If you are a homeowner having a hard time making your monthly mortgage payments due to a financial hardship, then a loan modification might be just what you are looking for.  A loan modification involves revising the loans terms to make your monthly mortgage payments more affordable for you.  You may be wondering if you qualify for a loan modification.  Here are three things you need to do to get yourself qualified for a loan modification.

The first thing you will need to be able to do is show that you are suffering from a financial hardship that makes your current monthly mortgages payments unaffordable for you.  A financial hardship may include job loss, a reduction in income, divorce, a death in the family, high medical expenses or other similar hardships. 

You will also need to provide proof that you will be able to afford reduced monthly payments under a loan agreement.  The lender wants to know if they grant you a loan modification that you will be able to make the new monthly payments and not go into default.  As part of your loan modification application you will need to provide financial statements that show your monthly income and expenses, both with your current mortgage payment and a proposed reduced mortgage payment.  Under the loan modification column you need to show how you can meet all your expenses including the revised monthly mortgage payment.

Finally, in order to demonstrate your financial hardship and ability to meet the terms of a loan modification, you will need to fill out an accurate and convincing loan modification application.    The loan modification application includes a borrowers statement, a cover sheet, a hardship letter and financial statements with supporting proof of income.  Your application is where you build a convincing case for why you are eligible and how you can meet lower monthly payments under a proposed loan modification agreement.

The borrowers statement is where you provide your basic information such as your name, social security and address. 

The hardship letter is where you demonstrate that you are facing a financial hardship that makes meeting your current mortgage payments difficult.  You want to be compelling but brief in presenting your hardship.

The financial statement is where you need to back up your hardship and also provide proof of your income and expenses.  You will need to show how you can meet revised monthly mortgage payments.

Finally the cover letter is where you propose specific changes to your current mortgage payment.  This will be backed up by the information you provide in your financial statements to show why your loan modification proposal makes sense.

If you submit an accurate loan modification application and can demonstrate that you have a financial hardship as well as the ability to pay according to the terms of a loan modification agreement, then you have an excellent chance of being approved for a loan modification.


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