When borrowers are having a hard time settling their mortgage loan, mortgage modification is often offered to them. This is also one debt solution that can save your home from getting foreclosed.
In mortgage modification, borrowers may be allowed to negotiate for lower rates of interest, lower principal amount, and longer mortgage payment terms. However, this process would normally take about 2-3 months, which is quite a long period and you may need to act immediately by getting in touch with your creditors from the moment you feel you’re heading to a financial breakdown.
All credit companies have their own team that manages delinquent accounts, and they are known as mitigators. These people usually are faced with mountainous workloads since they work on all types of debt solutions, such as mortgage refinancing, short sales, mortgage forbearance, foreclosure, and mortgage modification.
Since mitigators are too busy, they can’t easily be reached by phone, but you can get through if you exert more patience and effort. But if you really can’t, then you might have to ask for an appointment with the senior loan officer. You can also send an email requesting for mortgage modification. Find it important it record all your communications, whether through phone, meeting or email.
When opting for mortgage modification, credit companies or banking institutions will need you to submit an RMA or a Request for Modification Affidavit and a letter of hardship. The letter of hardship is a type of letter where you can state your reasons why your debt has fallen delinquent. You should also let them know the specific moves you’ve made to reduce your debts like you sold your car or you borrowed money from your family and friends.
Not everybody is qualified for mortgage modification. Before any approvals or rejections are made, creditors will still have to evaluate one’s financial records, and this would include income statements, fixed expenditures, bank statements, tax returns in the past 2 years, and home insurance policies.
If your application for mortgage modification is approved, a loss mitigator will then be assigned to help you go through the process. It is also one of their requirements that you undergo a trial period. In the event that your debt falls delinquent again, they already got no choice, but to foreclose your property. Given this instance, borrowers who were given a chance to modify their mortgage must strictly adhere to the terms and conditions.