The term loan modification is often surrounded by misinformation. The lack of a clear understanding about the modification process can prevent homeowners from taking the necessary steps to save their home. Our loan modification attorneys have provided some clarity to common myths.
Myth #1: The individual must be behind on payments to qualify.
Although this was true in the past, due to the 2009 passing of the Making Home Affordable plan, it no longer applies. Under this government plan, homeowners must be current on their payments to qualify.
Myth #2: A loan modification will stop foreclosure on a home.
The bank will continue with the foreclosure despite the homeowner applying for a loan modification. When represented by an attorney, they will file necessary motions and defenses to delay or stop the foreclosure lawsuit.
Myth #3: A person must have negative income to show financial hardship.
This myth goes hand-in-hand with the point of needing to fall behind on payments before being eligible for a loan modification. A homeowner should not wait until they are experiencing significant financial strain prior to seeking assistance.
Myth #4: The outstanding principal amount will be reduced through a loan modification.
While this outcome is not unheard of, it is extremely rare and should not be expected. Many adjustments can be made by lenders to achieve a reduced monthly payment. A common method of accomplishing this is to defer a portion of the payment to the date at which the loan matures.
Myth #5: Once a loan modification is denied, the home will be lost.
A denied loan modification does not necessarily mean that all options are exhausted. If the request is denied initially, hiring a loan modification expert to review, restructure, and resubmit the paperwork could lead to approval.
Hiring an Attorney for a Loan Modification
Homeowners can complete the loan modification process on their own, although it is an intimidating process. An experienced loan modification attorney will have extensive knowledge and experience working with lenders and providing the necessary paperwork, thus increasing the chances of receiving the new loan terms.
At Graham Legal, P.A. we take the burden of processing the loan for our clients while defending their case. We have secured an insurmountable number of modifications for our clients, with all mortgage lenders. Through our experience we have gained insight into the requirements of banks in order to process the applications. Contact our loan modification attorneys today to schedule a consultation.