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Frequently Asked Questions
Q:What is a loan modification?
A:A loan modification is a change in the terms of a loan resulting in payments that the borrower will be capable of making.
Q:Will a loan modification enable me to stop a foreclosure?
A:Yes, The new terms of the loan will allow the borrower to stay in their home, and put them current with loan payments.
Q:What Criteria qualify me for a loan modification?
A:The lender will require evidence that the borrower is able to afford the payments under the new terms of the loan. They may also want to see that the borrower has incentive to stay in their home, and that previous late or missed payments were caused by a hardship that can be rectified or adapted to by the borrower.
Q:Must I already be delinquent on my payments to qualify for loan modification?
A:No, most banks will accept applications from borrowers who are not currently delinquent. It will be required to prove that a hardship or rate increase will make it so the borrower is unable afford the loan payment under the terms of the original loan. There is no reason to wait to become delinquent before contacting a loan modification specialist.
Q:What types of hardships will a lender find to be acceptable?
A:These details will be laid out in a hardship letter and they may include, but are not limited to, illness, military service, loss of income, loss of employment, disability, death of a family member or partner, or divorce.
Q:Can I complete a loan modification on my own, or should I hire a specialist?
A:A borrower should consult upfront with a reputable loan modification specialist, who will provide alternatives to loan modification as well as a general understanding of the loan modification process and costs involved before deciding to act independently.
Q:Can missed payments be amortized into the modified loan?
A:Yes, the missed payments can be amortized into the new loan so that the loan may be brought current.
Q:May a mortgagee perform an interior inspection of the property before approving a loan modification?
A:Yes, the Bank may require any inspection that it deems necessary to verify that the property has no physical conditions which adversely impact the borrowerÕs ability to afford modified loan payment.
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