Getting A Loan Modification | Mortgage

A mortgage loan modification is an agreement between the lender and homeowner that allows the mortgage terms to be modified. The idea is that this will help you to be able to make your payments and keep your home in order to avoid foreclosure.

by GingerTaylor

There is one thing you should keep in mind before you start negotiating with your lender for a loan modification. The people you will be talking to have a job to do, and that job is to get you to agree to pay as much as possible so that the bank makes the best deal for itself. Nothing you say to the loss mitigation employee is confidential. It can and will be used against you, so watch what you say.

The next thing you need to do is get all of your financial information together. You will need to be able to prove your income and expenses. That means you have to have all of your recent pay stubs and bills, and maybe some that are not so recent. You will also need tax records for the past two to three years. Be prepared to prove any unusual expenses that contributed to you falling behind on your mortgage.

Everything the mortgage company mails you needs to be kept in a file. That includes regular statements as well as anything related to the negotiations you are trying to do. Keep even the envelopes. You may need to prove the date something was mailed. Also keep copies of anything you send the bank, and send it certified mail. Record all of your phone calls. Sometimes the lender will try to change the agreement on you, so you need to have proof of everything that has been done.

Don't spend your mortgage payments. Just because you are not paying the payment on the house right now doesn't mean it's all right to use the money to pay other debts or worse, to blow on things you don't need. Your lender will expect you to have some money to pay them as soon as you come to an agreement. Save the money so that you are ready when the time comes.

Be careful what you agree to. Sometimes the mortgage loan modification offered by the lender is a bad deal. In fact, a lot of times the offer that they will give you involves you paying your normal mortgage payment plus a certain amount for a number of months until you get caught up. Chances are, you won't be able to pay an even larger payment if you weren't able to keep up with the regular payment to begin with.

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DISCLAIMER: This article is provided as information only and is not to be taken as financial advice.

To learn more information about loan modification, visit Janian & Associates for the best advice from a qualified loan modification attorney.