Lots of homeowners across the nation are facing the possibility of foreclosure on their homes. One way to stop foreclosure proceedings is to apply for a mortgage loan modification. However, there are many requirements to be met before one can obtain a loan modification. The following information will provide some facts about how to qualify for a loan modification.
Phoenix, AZ -- (SBWIRE) -- 10/25/2012 -- The first step in qualifying for a loan modification is deciding whether to go through one’s current lender or through a different one altogether. Most banks and credit unions have their own, in-house modification programs, so look into them when researching loan modification. There are also home loan modifications available through the government, such as HAMP offerings. Common steps for any kind of loan modification, regardless of its origin, are as follows.
Request for More information Regarding Loan Modification Qualification
An applicant interested in how to qualify for loan modification must be either at risk of defaulting on, or already in default of, his mortgage. He must be able to prove financial hardship and explain how it came to be. He must also provide documentation that he will be able to afford a reduced mortgage payment each month by supplying 2 recent pay stubs from each of the people contributing to mortgage payment. If one has a second or third mortgage on one’s home, provide proof of it, also. Copies of the last two tax returns, utility bills indicating the correct address and homeowner’s name, and an unemployment insurance record, if applicable, are also required documentation. Add to that information about one’s credit card balances and savings or checking accounts and one should be ready to apply for a loan modification.
Looking at HAMP (home affordable modification program), there are additional requirements for this assistance. Here is how to qualify for loan modification plan, in addition to the above-listed requisites. Originally, one had to own and live in a one-to-four unit home; since June 2012, that requirement has been changed so that a person doesn’t have to live in the home, but he does have to own it and it must be one-to-four units. One must also have an unpaid principal balance of just under $730,000 for a single-unit property. Also, one’s mortgage payment must be more than 31% of one’s gross monthly income. Lastly, if an individual is approved for HAMP assistance, he must go through a three-month trial period during which he must make his scheduled mortgage payments on time and in full. After the three months of regular payments, one is entitled to a full HAMP assistance.
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