Loan Modifications

No doubt about, all the bad news about the economy and the real estate market is stressful.

For many of us, our mortgage is our largest monthly nut. I’ve been wondering when help will be available for homeowners who are at risk for losing their homes. As such, I’m intriqued by Governor Schwarzenegger’s plan to put a 3 to 6 month “stay” on foreclosures.

Hopefully, his plan will be a welcome and winning solution for the many people already in crisis. But what about the homeowners who are finding it harder and harder to pay their mortgage each month? Apparently some lenders are starting to see the light and are willing to, on a case by case basis, renegotiate mortgage terms for people who anticipate not being able to stay current.

The California Association of Realtors (CAR) website has additional information including a reference chart outlining some programs from different lenders that is worth reviewing. CAR recommends that prior to contacting the lender or loan servicer, you have on hand the following:

. Loan number

. Income information and documentation

. Most recent mortgage statement

. Bank statements

. Letter demonstrating financial hardship

The good news is, I understand that should the lender agree to modify the loan, it’s fairly inexpensive and might not negatively impact your credit score.

~ by DonnaGoldman on November 15, 2008.