Paying the monthly mortgage bill can become difficult, depending on whatever financial situation arises. Lenders often provide the option to refinance a mortgage loan. Another option is loan modification. Rather than starting over with a new loan, this adjusts the original loan terms. Your lender can, therefore, help make the loan less of a burden.
Ifyouβre considering a loan modification, these tips can maximize your chances ofapproval:
GatherYour Documents
Thelender will require certain documents if you request a loan modification. Theseinclude bank statements, pay stubs, tax returns, your budget, and a hardshipletter. The loan servicer might ask for other documents as well. Your onlychances of approval are if you include every document and ensure it is notoutdated. Labeling each document with your name and loan number is helpful aswell, as lenders receive mounds of paperwork each day.
ReleaseYour Tax Return
The loan servicer wonβt have access to your federal tax returns unless you sign IRS Form 4506-T. Your tax return is the most substantive proof of income you have. It should be provided along with other income documents your lender needs.
Talkto Your Lender
When you contact your loan servicer, ask about what they need. The exact requirements may depend on your situation. For example, two paychecks may represent your monthly income, but whether youβre paid weekly, monthly, or bi-monthly can affect how many documents your lender requires. Transparency helps eliminate misunderstandings that can turn into problems when it comes to obtaining a loan modification.
Checkon Your Status
Donβt let fear of rejection or pestering your lender get in the way. Itβs okay to call the loan servicer once a week to inquire about whether the file is complete or if any other information is needed. Inform your lender of any change in circ*mstances; lenders actually prefer to hear from homeowners regularly, so they have as much up-to-date information as possible.
DonβtBe Discouraged
A request to resubmit documents doesnβt mean your loan modification is off the table. Repetition can be frustrating, but being persistent can ultimately lead to a reward. Loan servicers often have a specific process for handling things; sometimes papers and files do accidentally get lost.
KeepYour Options Open
There are many options when it comes to loan modifications. Try applying for the Home Affordable Modification Program with the federal government or something similar from your bank. Just checking if you qualify can open new doors. If you donβt qualify, be open to negotiating with your lender. They may offer more than one option for making your loan payments more manageable.
Someways in which your home mortgage loan can be modified include:
- Interest ratereductions
- Extended loanterms
- Partial defermentof the loan principle
Whenyou reach a loan modification agreement with your lender, look at the specificscarefully. Make sure the terms provide a financial benefit before you sign onthe dotted line. By doing the math carefully, you can determine exactly howmuch youβll save each month.
Talkto a Loan Modification Attorney in Los Angeles
AtOakTree Law, homeowners in LosAngeles and Orange Countycan turn to us for legal options and answers regarding loanmodification. Financial hardship may be causing you stress, but our teamcan discuss available legal options and provide experienced counsel. We canhelp modify your loan in a way thatβs most beneficial to you, starting with afree consultation. Request a freeevaluationto learn more.
