Due to the recent economic recession, the entire home loan industry has changed stated income loans requirements. Most of the lenders have become very choosy in approving the loan applications and they are insisting full documentation, along with calculations of debt to income ratio, before any loans get approved. This directly affects the high cost housing markets like California, Florida, and the tri-state area of New York, New Jersey, Connecticut and parts of Maryland, Virginia, and Massachusetts. There are many homeowners using adjustable rate mortgages and qualified by using stated income, stated assets and in some instances, there is no verification of employment.
Adjustable rate mortgages will continue to be adjusted throughout 2010 and 2011. Many homeowners are facing tremendous problems in refinancing due to loss of equity in their home, job and other hardship factors. Hence, the best option in such conditions should be to look into home loan modification programs so that all possible chances of foreclosures can be avoided. People who are looking into the loan modification programs need to be aware of the fact that lenders are in the business of collecting debts. They are not there to negotiate with the public to change loan terms or modify interest rates. In most cases, the borrowers will not get through the right person who will be willing to work in their terms. You will have to make several phone calls, send hardship letters for a repeated number of times before your loan modification proposal finally gets approved.
If you are facing tremendous financial problems and there is no way to keep up with the mortgage payments, you need to seek some professional help. Talk to an attorney who specializes in cases of foreclosures and loan modifications.
Most of the times, borrowers say that their experience while negotiating with the lender for a lower monthly payment plan was not good enough, until the account has gone late for at least two to four months. By that time, your credit scores are severely hurt. Furthermore, you may not get qualified for a home loan from potential lenders in the near future. The best way to come out of this situation is to do a home loan modification program with some reputed attorney. They will work on your case and negotiate with the lenders on your behalf for a lower repayment plan. You not only get a chance to save your home from a possible foreclosure, but you get a loan modification done, reducing your interest rate to an affordable level, and in some cases, reducing the principal amount substantially. Keep in mind that there is no guarantee that you will get the desired results in the loan modification program, but it’s worth a shot.
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July 8th, 2009 at 2:46 pm
I found your blog on google and read this great post on loan modification. I just added this site to my Google News Reader. I Look forward to reading more here in the future.