It can be very confusing and frustrating for desperate homeowners trying to get a loan modification with their lender. Between harassing phone calls from their bank and receiving solicitations from all different types of companies and attorneys offering to represent you for a fee, how do you know which option is best for you? This is an important decision-your family home may depend on it-so now is not the time to take chances. You need to get some good, accurate information about how the loan modification process works and what you can expect so that you will be able to make a wise and informed decision.
Many loan modifications can be done very effectively without the services of a company or attorney. An informed and prepared borrower can get a loan workout with their bank by learning and following step by step directions. This is not brain surgery, but there are some important qualifying tips you need to know to increase your chances for success. Some homeowners may be faced with a more complicated set of circumstances, and do not feel that they will be able to get results without the help of a professional.
The federal stimulus plan features a loan workout program with standard guidelines for everyone. This makes the approval process much easier to understand, so that the average homeowner can work directly with their lender and be successful. The only thing that you need to understand before beginning the application process is what those approval guidelines are. This way you can work on your financial statements ahead of time and be able to make the necessary adjustments to qualify. Be sure to learn about the approval guidelines for the Home Affordable Modification before you contact your lender. Most borrowers can easily apply for this program on their own without the expense of an attorney.
Is your lender being extremely uncooperative? Do you feel that you were a victim of predatory lending or even fraud? When a loan modification application is repeatedly declined, or when there is evidence of fraud or other lending violations, a homeowner may benefit from the services of an attorney who specializes in loss mitigation. There are laws that have been enacted to protect borrowers from unfair lending practices. An experienced attorney can review your loan documents and possibly discover evidence that a violation has occurred.
A violation in lending law is taken very seriously by the lenders. They are subject to severe penalties if found not to be in compliance. Legal action can be brought against your lender if you have been a victim of this type of lending practice. An attorney who is experienced with this type of action can offer you a very effective strategy for getting your lender to cooperate with your loan modification request. This is really a tool to gain leverage with your bank and convince them to cooperate.
The down side to retaining an attorney to pursue these more complex strategies is a big one-Money! Most attorneys require a large, upfront retainer to start the legal paperwork necessary to pursue this type of action. This retainer is almost always non-refundable and there is no guarantee of success. Struggling homeowners who cannot pay their mortgage payment may be hard pressed to come up with the thousands of dollars required to begin the legal process. The loan modification process may be extended and take more time to resolve once an attorney becomes involved.
Homeowners really need to understand their options and know what the best course of action to take is for their particular situation. Let's face it - loan modification - companies and attorneys are in business to make money-it is up the homeowner to make sure that they are pursuing the best course of action for themselves. Once you have a good, general understanding of how the loan modification process works and what to expect, you will be able to make wise and informed decisions that will give you the best chance at saving your home.