| Determining Whether Refinancing Or Loan Modification is the Better Choice For You |
Help is available through the Home Affordable Plan to homeowners struggling to make their monthly mortgage payments. Loan modifications can lower your monthly mortgage payment to help keep you in your home if refinancing is not a viable option for you. Below are some points concerning loan modification.
* Homeowners can extend their payment terms up to 40 years and reduce their interest rates by up to 2% using the Home Affordable Modification Plan. This plan allows homeowners who are suffering with financial difficulties to modify their loans based on hardship. This is an especially a good option for those who lost their jobs and don't qualify for refinancing. It's also a better option for those whose property values have declined or where the real estate market is still soft, preventing them from being able to sell their homes.
* If you're insured under Fannie Mae or Freddy Mac, the plan requires that your mortgage be at least 105% of the current value and that your mortgage payments have not been more than 60 days late within the past 12 month period. For those unable to refinance, the loan modification plan provides current market rates for qualified homeowners.
* New guidelines have extended the FHA insured Hope for Homeowners plan to make it more available to qualified homeowners. Lenders participating in the federal loan modification program are incented to help you get your loan modified rather than face foreclosure.
Being prepared and gathering your documents together before meeting with your lender will give you a leg up
on your chances to qualify and be approved for a loan modification. Review the requirements, processes, and plans at sites to get an application for and prepare to request a loan modification. Be sure to complete the application correctly and follow the steps in detail so that to avoid delays or denials. You want to give quality to attention to the application because you are only allowed to apply once.
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