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Mortgage Modification Package

Question: how can i get a loan modification if my spouse gets paid off the books?

ok please help me...i want to apply for a loan modification on my house cause i cant afford this months mortgage. the problem is i dont want to go outside and pay $3000 to get it done when the bank send me the package to fill out and send back to them...the problem is im currently working and paying my taxes through my job BUT my spouse is getting pay off the books...how do we go about letting the bank know this?? or can we get in trouble??? they r asking for both our paystubs.

Answer: Thats the glitch with getting paid off the books (and not paying taxes)..you can't claim that income when applying for a loan. Yes, you can get in trouble if the government finds out you're not claiming all your income. So I wouldn't suggest trying to use it to get a loan. You have no way of showing that income anyway since its not reported on his pay stubs or tax returns.

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Loan Modification Capital One

A mortgage loan modification is something you’re going to hear a lot about in 2009. This program, not fully invented yet, is a process whereby the lender agrees to modify the existing terms of your loan. Many times there is an interest rate reduction, reinstatement and often-missed payments are forgiven. 

You can apply for a Mortgage Loan Modification yourself, but it’s grueling work. Even professionals like us have a hard time negotiating with these lenders and an emotional attachment to the property in question would make an already stressful situation that much harder.

Lenders have a Loss Mitigation Department, which handle these requests, but trying to get through to them is nearly impossible, unless you have already missed a payment. Then, the keen interest is triggered and all of a sudden they want to speak to you.

I encourage you to open and to keep current, a dialogue with your lender. Be honest with them and explain to them the reasons for your economic downturn. They may request that you submit a Free Hardship Letter, a sample of which is available on our website. This letter details succinctly the details of your hardship. 

Has somebody lost his or her job? Is  there an illness in the family? Medical bills? Perhaps another mouth to feed? All these are hardships that may lead to economic stress and your inability to keep current on your existing loan.

The lender will require that you submit documentation as well as a stack of paperwork proving what you have told them. This will include tax returns, pay stubs, bank statements etc. And there in no guarantee that they will actually go ahead and modify your loan. If you are too far underwater, they may suggest a short sale.

If the lender sees that you can’t afford a modified mortgage, they will not go through the process and work to adjust your mortgage. Why should they if you’re going to default in another six months anyway? That’s why it is important not to hide income from your lender. They want to see that you can keep your home and if you are receiving rent money or other income that isn’t documented, reveal this to your lender. Isn’t false representation of the truth what caused a lot of this distress we’re going through?

A short sale situation occurs when you owe more than your home is worth. In that case, a lender will agree to take a loss by accepting a sale price for less than you owe. Why would they do this? The reason for the lender’s sudden generosity is that they are trying to stay afloat themselves. Too many non performing assets on their books means they don’t have this tied-up money available for lending. Without loans, a bank is dead in the water.

If you want to try to modify your own loan, get the Hardship Letter sample on our website. If you want to trust the process to an attorney-led team, please consider CMA Capital Funding Inc as your representative.

About the Author:

Chuck Machado is a partner with CMA Capital Funding Inc and is considered a commercial mortgage specialist. He is currently working with homeowners in and their lenders in Loss Mitigation and Loan Modifications

Source - What Exactly is a Loan Modification

Magic Button Mortgage Lead Generator

Loan Modification Value Test

The Obama administration’s Making Home Affordable Plan is in full swing and is effective immediately. Homeowners who are on the brink of losing their homes due to foreclosure have finally saw a ray of sunshine at the heart of the most powerful president’s large-scale plan, Barack Obama’s aim of saving millions of homeowners and the housing industry from the sludge.

Obama home loan modification is one of White House’s ambitious plans of helping almost 5 million citizens to restructure their current mortgage into something workable. To encourage active participation, the said home loan modification is set to benefit both parties – the debtor and the lender. Viewing the plan to a homeowner’s perspective, an opportunity to rework troubled financial loans to a more affordable cost is said to be the advantage of the modification program. Then again, seeing it through the lenders’ perspective, the government provides cash incentives to these private investors from every approved and modified mortgage of at-risk clients. Hence, both parties involved shall benefit from the said modification program.

To provide you of further details concerning Obama home loan modification, here are key facets of the said modification program.

1.    Its not about upside-down loans – It’s all about the ability of a homeowner to pay the monthly payments. The Obama modification plan centers on providing struggling homeowners the chance to stay in their properties as long as they can comply with the agreement of paying their monthly obligations on time. Upside-down loans occur the moment a debtor’s loaned balance is greater than the value or cost of the property, hence the foreclosure. Contrary to the statement, foreclosures only happen if a homeowner is not at all capable of paying his monthly dues, and certainly not the so called ‘upside-down loan’. Succinct to say, it’s not about the price, but it’s the payment that matters.

2.    Serious hardship – Those who are eligible for Obama home loan modification program are those with really serious undertakings in their present financial condition. Those who have been affected of spiral of lay offs due to painful recession and those who have a principal remainder of up to $729,750 are the only ones entitled for this program. A debtor will just have to sign an affidavit of financial hardship together with supporting documents such as income statement and the like. Then, the verification process will be done as soon as a debtor is able to accomplish all the necessary requisites needed.

3.    The thirty-one percent policy – The Obama loan modification plan also ask lenders to moderate and trim down monthly payments of borrowers to no more than 31 percent of the debtor’s net compensation. As a means of lowering and reducing payments, the lender would primarily decrease the interest rate to 2 percent so as to hit the 31 percent limit and lengthen the terms of payment up to 40 years.

4.    The net present value test – This specific test would be the determining factor if a particular mortgage will be modified. To confer to the best economic interest, a lot of lending investors generally delve deeply into the production of more cash flow as a way of verifying if your mortgage is qualified for restructuring.     

Will all these plans work? At the outset, the program may reduce possibilities of foreclosures, that’s for sure, but it could also pave way to a spike in mortgage defaults. What do you think? You be the judge.

About the Author:

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Source - Obama Home Loan Modification - Everything You Need to Know