I am a manager for a bank in the Loss Mitigation department, let me tell you this, the loan mod companies out there do not get you anything that you cannot get on your own. I do not give special concessions for a 3rd party rep; if anything you are in a stronger position without these companies because the money that you would normally pay them, you can use as part of the down payment of the loan mod (if you are deliquent), or to shore up your financial situation after the mod is complete. In short, Loan Mod companies do not do anything for you that you cannot do on your own.
There is website that you can check out about the new stimulus plan that will kick in on March 4th. It is www.treasury.gov. If you have a loan that is Fannie Mae or Freddie Mac, you might be able to refi to a fixed rate 15 or 30 yr loan at the current interest rate. There are qualifications that must be met. Check out the website. I am in Customer Service with a Mortgage Company so I also get a little inside info. If you want to apply for that on March 4th, you can start gathering documents that you will need:
- info about the gross monthly income of everyone listed on the loan, including your most recent pay stubs and other income you receive.
- your most recent income tax return.
- info about any second mortgage on the home.
- payments on each of your credit cards if you are carrying balances from month to month.
- payments on other loans such as student loans and car loans.
You may also call your mortgage company and tell them you are having a hardship and want to know if a loan modification is possible. I did it with my HELOC and got the 3 parts of my HELOC reduced as follows for 1 year:7.29% down to 3% 8.29% down to 3% 3.4% down to 3%. In addition one of my loans is having payments postponed until the end of May 2009. I’ m waiting for my first mortgage company to process a similar request.
Thanks for the information about the loan modification. I did call my bank, and I am in the process of getting all my documents together to present to them. They have a committee that meets once a week (it is a small bank) to consider the loan modifications.
Well, if a client of ours is interested in a loan mod, I would recommend that they contact customer service (call the number on the mortgage statement) and let the rep know you need to speak with someone in Loss Mitigation, or that you are suffering a financial hardship and need help with the monthly payments. The CSR will be more than happy to transfer you to the right department. If you are currently deliquent the same conversation can be had with one of the mortgage collectors.
I do not think I should disclose which bank I work for, but it is one that received bailout money, and FYI, the FDIC is actually defining what and how loan mods are done.
Hope this helps.