Many people in today’s housing market can relate to the feeling of impending foreclosure. There are thousands of Americans that are struggling to pay their mortgage and fees they have accumulated. Due to the high number of people facing foreclosure President Obama has created the “Make Home Affordable” plan in hopes of keeping the majority of homeowners in their homes and avoid foreclosure. The plan includes Bank of America as one of the largest banks that will adhere to the new plan.

When approaching a large bank like Bank of America you should have the application properly completed and all documents ready. One of the first steps you will need to take is creating a financial hardship letter. The letter should have reasons for why you are in your current situation and any reasons that have caused you to not pay your current home mortgage. There can be many different valid reasons for your difficult situation like loss of job or decrease in income, medical emergencies, and death in family etc. Keep all proof of these events should be readily available in case the bank asks you to provide proof of these events.

It is very important that you remain truthful in your letter to the bank. Don’t over exaggerate and be to the point, give them the reason for you current difficulties and explain to them that you will be able to get back on your feet if you can just readjust your current rates and term. The bank will look into the reasons you provided to make sure that you are be truthful. It you are caught in a lie you will be disqualified from refinancing or mortgage modification into a better loan.

Prior to actually submitting your application read through their guidelines and requirements. You may find details that you don’t agree with and you should make sure that you are comfortable with all the new arrangements. Once you put your signature on the dotted line you will have a hard time rejecting any conditions they have listed in the contract.

You should also try to clean your credit report as best you can if you know for certain that it will hurt you. However if you have good credit then it will be real hard for Bank of America to not accept your application request for a loan modification.

-M Petrone

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