What Is A Mortgage Loan Modification?

    In 2014 many homeowners in Orange County still have underwater mortgages or are struggling with paying their mortgage.

    One common solution which the average homeowner who is struggling to pay their mortgage will be faced with is loan medication.

    We’ve all heard good things and bad things about loan modification and the reality is most of the stories don’t provide any real facts about how loan mods work that’s why we will break down the entire loan modification process from start to finish in this article.

    Step 1 – Obtain a Loan Modification Package  

    Contact your lender and ask them for a loan modification package.

    During the process of completing this package you will be required to submit a monthly budget, hardship letter, tax returns and any other documents which your mortgage loan servicer requires.

    Completing the entire package and submitting all of the documents which your lender requires is an important part of having your loan modification approved because, if any of your documents are outdated or missing your entire file will be dropped to the bottom of their pile.

    Step 2 – Don’t Understand What They Want? Don’t Be Afraid To Ask

    Going through the loan modification process can be confusing at times. That’s why it’s important to ask questions if you don’t understand what your lender is asking for.

    A common misunderstanding which can seemingly “derail” the entire loan modification process is the issue of paycheck stubs because, a servicer will often ask for two paycheck stubs assuming you get paid bi-monthly but if you’re paid weekly or monthly you may submit more or less paycheck stubs than their requirements.

    This is why it’s important to ask questions and clarify what your lender wants before submitting the documents.

    Step 3 – Stay In Touch With Your Lender

    Once you’ve submitted your loan modification package don’t hesitate to call your servicer at least one time per week or bi-monthly to check on the status of your mortgage loan modification request.

    You should also ask your servicer if your package is complete and be sure to explain any details of your circumstances which may have changed since you filed your loan modification documents.

    Step 4 – Don’t Give Up

    Your mortgage loan modification may take months until it’s approved but don’t give up because, if you’re persistent and show your lender that this is something you are serious about completing your loan modification it will ultimately be approved.

    To learn more about if loan modification is right for you or to view homes for sale in Orange County contact Fred Sed & Associates today by calling us at (949) 272-0125.

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