In the past people could only seek a modification of their mortgage if they fell behind on their mortgage payments and if their mortgage company started the foreclosure process. Yet most people know far in advance when they will have challenges making their mortgage payments. The reason mortgage companies never modified mortgages for people until they fell behind on their payments was simple. They were just following the wording of the legal agreement they had when these mortgages were taken out. The Making Home Affordable Modification Program addresses this. The guidelines state that a person who is current on their mortgage but feels that they will not be able to continue to make their mortgage payment on time may qualify for a modification to their mortgage.
The first thing to understand is that common sense will never be a factor in the outcome. Bank of America gets thousands of new loan modification requests every day and the only logical way to handle the workload is by creating a very rigid, automatic system that determines "qualified" from "denied" loan modifications. The outcome is very rarely determined by a human decision maker, its based on numbers. The only numbers that really matter with Bank of America are your income, expenses, and monthly payment. It is typical that the decision will be made based on these numbers alone. You should always research Making Home Affordable financial guidelines before beginning this process. This government program is usually your best option, and most investor/traditional loan modifications are beginning to adopt these same guidelines for their own analysis.
The next thing to understand is the incredible amount of patience and persistence that you will need throughout this process. The loan modification process with Bank of America takes 60-90 days. In other words, no matter what you will start at the "back of the line with all your groceries". Throughout the process it's ok to call once a week, but twice a week is advised. You shouldn't expect amazing results with every call, they move slow and its very important to find out if they are requesting updated documents. If thats the case you should get them the requested info asap. Many people have learned the hard way by having their review closed after 10 days of inactivity and they have to move to the back of the line, only to begin the entire process again.
Net monthly income is the monthly gross income less monthly payroll deductions, the monthly escrow payment for property taxes, home owner's insurance and mortgage insurance, any association fees, car and credit card payments, all other reasonable living expenses and any losses the person may have on rental or investment properties. If the person's net monthly income is less than 120% of the monthly principal and interest payment on their mortgage and if they have savings less than 3 times the current monthly principal and interest, taxes and insurance payment on their mortgage, they will qualify for a loan modification under the program.On any case where the mortgage company approves a loan modification for a person under these circumstances, they have to document the reasons they did so in their system.
Mortgage companies cannot solicit any person who is current with their mortgage payments or who is less than 30 days late on a mortgage payment to seek a loan modification. The person in either of these situations must contact their mortgage company and ask for consideration. If you are current on your mortgage but fear that you will be unable to continue to make your monthly mortgage payments on time, you may want to explore whether you can get your mortgage modified under the Making Home Affordable Modification Program. Rather than doing it yourself, it is better to contact a lawyer or an expert in modifications. They can review your situation and determine the best course of action for you. They will also save you much time and stress.
The first thing to understand is that common sense will never be a factor in the outcome. Bank of America gets thousands of new loan modification requests every day and the only logical way to handle the workload is by creating a very rigid, automatic system that determines "qualified" from "denied" loan modifications. The outcome is very rarely determined by a human decision maker, its based on numbers. The only numbers that really matter with Bank of America are your income, expenses, and monthly payment. It is typical that the decision will be made based on these numbers alone. You should always research Making Home Affordable financial guidelines before beginning this process. This government program is usually your best option, and most investor/traditional loan modifications are beginning to adopt these same guidelines for their own analysis.
The next thing to understand is the incredible amount of patience and persistence that you will need throughout this process. The loan modification process with Bank of America takes 60-90 days. In other words, no matter what you will start at the "back of the line with all your groceries". Throughout the process it's ok to call once a week, but twice a week is advised. You shouldn't expect amazing results with every call, they move slow and its very important to find out if they are requesting updated documents. If thats the case you should get them the requested info asap. Many people have learned the hard way by having their review closed after 10 days of inactivity and they have to move to the back of the line, only to begin the entire process again.
Net monthly income is the monthly gross income less monthly payroll deductions, the monthly escrow payment for property taxes, home owner's insurance and mortgage insurance, any association fees, car and credit card payments, all other reasonable living expenses and any losses the person may have on rental or investment properties. If the person's net monthly income is less than 120% of the monthly principal and interest payment on their mortgage and if they have savings less than 3 times the current monthly principal and interest, taxes and insurance payment on their mortgage, they will qualify for a loan modification under the program.On any case where the mortgage company approves a loan modification for a person under these circumstances, they have to document the reasons they did so in their system.
Mortgage companies cannot solicit any person who is current with their mortgage payments or who is less than 30 days late on a mortgage payment to seek a loan modification. The person in either of these situations must contact their mortgage company and ask for consideration. If you are current on your mortgage but fear that you will be unable to continue to make your monthly mortgage payments on time, you may want to explore whether you can get your mortgage modified under the Making Home Affordable Modification Program. Rather than doing it yourself, it is better to contact a lawyer or an expert in modifications. They can review your situation and determine the best course of action for you. They will also save you much time and stress.
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