Loan Modifications with Bad Credit
Loan modifications are the perfect way for distressed borrowers to solve a delinquent mortgage problem.
Even if you have late mortgage payments, collection accounts, liens, judgments, or any other derogatory credit you can qualify for a loan modification.
Most homeowners in need of a change in their mortgage terms immediately think of a traditional refinance. However, many distressed borrowers cannot refinance because they do not qualify.
As most people know there are many qualifiers to be able to obtain a refinance of an existing mortgage. These qualifiers do not apply in the same way when it comes to a loan modification.
Some of those qualifiers are:
CREDIT
The beauty of a loan modification is that since you are working with your current lender who is already invested in you and your home the criteria are far less stringent.
The toughest mortgage qualifier for a borrower who is behind in payments is credit. When it comes to a loan modification your credit is not analyzed.
EQUITY
In today's tough real estate market property values are plummeting. Many homeowners do not have the equity required to refinance. Remember if you are financially upside down in your home, your lender is too. Your current lender will not have an equity requirement when it comes to modifying your loan.
EMPLOYMENT
When it comes to employment, the normal mortgage requirements again do not apply. When applying for a new mortgage a lender will require a minimum of 2 years on the same job. In regards to a loan modification, the only requirement will be proof that you are indeed working.
INCOME
Income is also an important qualifier in the mortgage process. Although income is still a big consideration in a loan modification it is not considered in the same way as it is when applying for a new mortgage. Qualifying for a loan modification is simply a comparison of your expenses versus your income. If you can prove that you can pay your mortgage at a certain payment per month then the lender will modify your loan.
Always remember banks do not want to foreclose on your home. They take huge losses on foreclosed properties.
If you are behind on your mortgage, loan modification may be the perfect solution. Many a distressed homeowner have negotiated a loan modification and saved their family home from foreclosure.
You can too!
DAN HARRIS - ALL RIGHTS RESERVED 2008
Dan Harris operates Harris Capital Management and Mobil Settlement, LLC in New York and can provide detailed information on , Title Insurance Issues, Mortgages, New York City Real Estate, Loan Modification & Loss Mitigation and more.
Dan is available for seminars and speaking engagement.
He can be reached at LoanModBook.com, CashDan.com, and MobilSettlement.com
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