There are some other facts that explain why lenders are actually in favor of working with borrowers and their legal specialists in order to negotiate equitable loan modifications.
- All or portion of the
outstanding principal and interest, past due escrow, late fees, and even
costs may be rolled into the loan modification and thus will not be lost
revenue to the lender. Since they are spread over a long period of time,
they do not pose a problem to the borrower.
- Modified mortgages may use a
step rate approach or an extended term methodology to provide for the
repayment of the due and past due funds. The lower payments ensure the
repayment by the borrower while to the lender the added time is actually
money in the bank in terms of yet to be earned interest due.
- Foreclosure is avoided and even
though banks routinely foreclose on properties and sell the homes to other
buyers for a fraction of a price, the slowing housing market has made it
difficult for banks to unload such properties and then recover any
additional funds from the previous homeowners. Loan modification is a
fiscally much more attractive solution for any lender.
- A modified loan protects the
credit rating of a borrower and it also helps lenders in showing less
defaulting loans in their portfolio. This of course makes a good impression
when the financial institution is wooing potential investors.
Here are the
requirements you must meet in order to be considered a good candidate for a
loan modification process to be started on your behalf:
- Your monthly mortgage must be
affected by a verifiable reduction in income.
- It is required that you are
currently employed or have another source of a stable and predictable
monthly income that is provable.
- The home for which you are seeking to obtain a loan modification must be your primary residence.
For assistance with packaging your loan modification package contact us at info@myforeclosureconsultant.com
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