search site:

Do I meet the requirements for a loan modification

In many instances a customer is set up on a stipulated plan previous to executing a loan modification which allows a servicer to monitor the financial condition of a customer during the special forbearance period to be sure the customer will be able to make payments to the lender. There are significant documents required that are reviewed by a servicer

Hardship Letter:
To qualify for a loan modification customer must have a compelling hardship. The hardship must be documented and given as many details as possible to support your case. A is very subjective and pretty much a formality in the course of getting a loan modification. There are a few hardships that are considered charitable and do not qualify quitting employment or reducing the total hours worked are typically unacceptable. The hardships are documented and if there is an additional failure to pay the customer can not use the same reason for failure to pay otherwise their previous hardships was really not over and in many instances the customer is not allowed a mortgage modification.

Financial Statement:
This is used to establish the customer ability to pay. This is usually the first document reviewed by the lenders negotiator. This document must clearly indicate monthly earnings and operating cost as well as current assets and liabilities. This is what makes and breaks the entire mortgage modification review. This document also shows whether or not the customer will be able to make payments if the mortgage is modified. There must be a surplus earnings at the end of the mortgage modification or else the plan will be denied. The plan must be affordable. If a customer is severely over-leveraged with debt there is little chance that a mortgage modification will cure the delinquency. Monthly operating cost are reviewed to determine what bills are necessary and what are unnecessary. Necessary operating cost are food, utilities and gas and an example of unnecessary are entertainment operating cost, expensive phone plans and unsecured debt. Household operating cost mortgage payments, utilities, and taxes take up most of the monthly budget. Do not make operating costs look unreasonable will be a red flag to get further detail. The negotiators will always look for assets that can be liquidated.

Proof of Pay:
The proof of earnings is usually a paycheck stub, a P&L Profit and Loss Statement if self employed, or checking account report showing paycheck deposits. The proof of earnings is required to prove the customer has steady earnings. The customer must also give frequency of earnings. The proof of earnings must correspond with the earnings shown on the financial report. Resolve any discrepancies

Article Source: http://www.contentfueled.com

Donald Morris the author of Foreclosure Help. There is more information about loss mitigation at Help Stop Foreclosure. Also read our blog about Loan Modification Help

Please Rate this Article

Not yet Rated