Many financial lenders and banks make the requirements for a loan modification seem either very simple or extremely complicated. Besides the basic information that you will be asked for like your social security number, name, address etc, the process is actually very easy.

Mortgage Modification: How to Qualify

1. The home in question must be your primary residence.

A loan modification will not be approved if it is an investment home, holiday home or second home. The home loan modification plan was implemented for primary residence homes. If you do happen to own a second home it is very unlikely that you would be approved for a loan modification.

2. Be completely open with bank or lender.

It is very crucial to the process to remain absolutely truthful regarding your personal financial information. The information that you provide is an essential tool to coming up with a new loan agreement. Do not try to make it sound better or worse than it actually is. Trying to cheat will only hurt you instead of help.

3. 30% of the income will go to pay the loan.

The negotiated mortgage modification according to the national guidelines is 30% of your total monthly income. You may feel that 30% of your income is too much, but if you look at what you are spending now it is more than 30%. You also always remember to look out for unnecessary fees that may want to sneak in like legal or administrative fees.

All of the financial institutions and banks have different security and confirmation protocols, so they may ask for different information. Remember that you are a customer and not a charity case; don’t let anyone make you feel like they are doing you a favor. Do a bit of research and look for an institution that will work best for you, these institutions receive payment for the government if they sign you up. Remember when shopping around that you are a client and just because you ask a mortgage lender or bank for some information does not mean that you are agreeing to sign with them.

Having a legal consultant review any agreement is always a good idea. It may cost some money but in the end it is worth it for the peace of mind. This way you won’t be caught off guard with any type of loop holes or strange unnecessary fees. So if you are not absolutely satisfied with the agreement don’t sign it.

-M Petrone

Subscribe via email

Enter your email address:

Delivered by FeedBurner