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Tips For Your Loan Modification Application

Loan Modification Help Center

One of the reasons a loan modification attorney is so important to the loan modification process is that there are a million details and subtle nuances involved throughout the process.  For example, successfully filling out the loan modification application requires a great deal of understanding.  Trying to fill out your loan modification application on your own can be even more complicated than filling out your taxes.

Here are some important tips and bits of information that will be helpful in filling out your loan modification application.

Debt Ratio – Borrowers often have their loan modification application rejected because of their debt ratio.  Debt ratio is one of the key factors lenders will use when deciding whether or not a borrower is right for a loan modification.  However, most homeowners really do not understand what their debt ratio is or how to figure it out in order to qualify for a loan modification.  A debt ratio is the percentage figure that represents how much of your gross income is spent each month on your housing expenses.  Housing expense is the total of your mortgage loan and interest payment, your property taxes, insurance and home owner’s association dues (if applicable).

For your loan modification application to be accepted by your lender, your debt ratio must be at an acceptable percentage.  Most banks, mortgage companies and other lenders require an absolute maximum of 45% debt to income ratio.  If your loan modification application has a higher ratio, then the likelihood of being rejected is very high.  The lender is looking to see you can prove your ability to afford the new house payment, both now and in the future.

Even the federal loan modification plan, called the Home Affordable Modification, has a debt ratio guideline; the government is targeted at 31%.  If you take your total monthly household income (which includes the income from both spouses) and multiply that by 31%, that is your target payment.

Most likely, if you are having a difficult time making your current payments you have a debt ratio higher than 45%. 

Besides your debt ratio, there are many other aspects of a California loan modification application which require a great deal of attention.  For example, your hardship letter, your financial history and other information must all be accurate and build an effective case on your behalf.  For these reasons, a California loan modification attorney is a must when trying to procure a California loan modification.

Figuring out your debt ratio can be confusing, gathering your information can be difficult, contacting the lender can be time consuming and a whole host of other problems can arise when trying to get a loan modification.  A California loan modification attorney can help you from beginning to end, giving you the best chance to get your California loan modification approved.

A California loan modification attorney will work with you to put your application together, contact your lender, negotiate on your behalf and put you in the best position possible for a California loan modification.

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We can help you stop foreclosure with a loan modification in the following states:

If you need help understanding your option of taking advantage of the home loan modification process, the help is available to you everywhere. The process is quite tricky and it is highly recommended that you do indeed seek legal advice before signing on the dotted line, in order receive the most efficient and cost-effective modification to your mortgage payment.

Where do I get Advice
There is advice all over the web on how to receive a loan modification; some of this advice is quite helpful, while some is quite dreadful. There is also the opportunity to hire a professional service that will help you go through the paperwork and work with the lender to help you get all the benefits that you deserve, due to a hardship. Loan modification is a process that must be understood completely and thoroughly. This article can actually offer you an insight on the process of loan modification and tips that will better help you as a homeowner save your home from the risk of a foreclosure.

Loan Modification Advice
First and foremost, it is important to determine if you are eligible for a loan modification. This requires writing a letter of hardship explaining to the lender what exactly the reason is for your late payments and the fact that you are unable to pay your mortgage. Doing a loan modification on your own requires more than just advice. Becoming educated about the process is more important. This is perhaps a good reason to hire a professional loan modification company to take part in the process. They will handle everything for you, while educating you in the progression. There is a fee charged for hiring these companies, but in turn your mortgage payment can be lowered quite a bit and professionals can even find things in your original loan papers that may prove that the lender may have broken the law during your original mortgage signing.

If you do choose to take the big leap of the loan modification process on your own, you must first contact the lender and they will lead you to the correct department, normally the loss mitigation department. You may not want to directly say that you are in the process foreclosure. We do not want the lender to think your situation is not worth their time before hearing you out. Always document anything relating to the loan modification process, every phone call and any other information you may receive during the process must be documented. Always discuss every option available with your lender, so that you may come up with the best alternative for you. It is true you will save money going directly through your lender and let’s face it, you are struggling already trying to make your payments, but professional assistance can help immensely.

No matter what direction you decide to take, loan modification will be what determines the amount of time you have in your home. If you are eligible you should act as soon as possible.



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