Servicers provide permanent modifications to 31,382 troubled borrowers, according to first reportissued by Treasury Department. An equal number have been denied.

NEW YORK (CNNMoney.com) — Onlyabout 4% of troubled borrowers have received long-term help under the Obamaadministration’s foreclosure prevention program, Treasury officials saidThursday.

A nearly equal number of trialmodifications have been denied permanent assistance, the report showed. Thereasons include not making monthly payments on time, not submitting all thenecessary paperwork and not qualifying for reasons such as insufficient income.

The report, the first comprehensivetally of permanent modifications made, shows that loan servicers have converted31,382 people from trial adjustments to long-term assistance as of Nov. 30.

But 30,650 people in trialmodifications have been denied, according to Treasury officials.

The dearth of permanentmodifications has fueled concerns that the $75 billion plan will fall far shortof its goal to help up to 4 million delinquent homeowners.

The number of troubled borrowerscurrently in trial modifications rose to 697,026, up from 650,994, a month earlier.

“Our focus now is on workingwith servicers, borrowers and organizations to get as many of those eligiblehomeowners as possible into permanent modifications,” said PhyllisCaldwell, chief of Treasury’s Homeownership Preservation Office.

Banks and the administration havecome under fire in recent months as delinquent borrowers languish in trialmodifications. Lawmakers lambasted servicers and Obama officials at a congressional hearing Tuesday for not doing more to help homeowners facingforeclosure.

Last week, the administrationannounced it was ramping up its oversight of loan servicers’ conversionoperations, sending in SWAT teams to break up any logjams, and requiring banksto submit updates twice daily on their efforts. Administration officials calledfinancial executives to Washington this week to urge them to quicken theconversion pace.

“We’re not satisfied yet withhow this program is unfolding,” said Treasury Assistant Secretary forFinancial Stability Herbert Allison at the House Financial Services hearing.”The servicers have a lot of work to do, and we’re holding themaccountable for their performance.”

While the permanent modificationfigures are disappointing, there is still time for the Obama administration toturn the program around, said Alan White, a law professor at ValparaisoUniversity. But he would like to see a big increase in the numbers in the nextmonth or two.

“Treasury is aware there is aproblem,” White said. “We’ll see if they are able to do somethingabout it.”

Thursday’s announcement came hoursafter a report showed the foreclosure crisis might be mitigating somewhat.Foreclosure filings fell by 8%in November, the fourth consecutive month of declines, according to RealtyTrac,an online marketer of foreclosed properties.

The paperwork

Under the president’s plan,delinquent borrowers are put into trial modifications for several months tomake sure they can handle the new payments and to give them time to submittheir financial paperwork. Once the modification becomes permanent, servicers,investors and homeowners are eligible to receive thousands of dollars inincentive payments.

If they qualify for a long-termmodification, borrowers can keep making the lower payments for five years,after which time the interest rate is set at the rate at the time of theadjustment, or about 5% today. Borrowers in modifications are saving an averageof more than $550 a month.

Loan servicers say they are havingtrouble getting the necessary documents from borrowers.

Some 375,000 people should beeligible to receive long-term relief by year’s end. But only one-third ofhomeowners who have made at least three trial payments have submitted all theneeded forms, Treasury officials have said. Some 20% have not submitted anypaperwork. Banks and government agencies have hired outside companies to knockon borrowers’ doors to assist them with completing the paperwork.

Homeowners, however, maintain thattheir financial institutions are constantly losing the paperwork.

Donna Belanus, who just made herfourth trial payment to Wells Fargo, has repeatedly faxed her financialinformation and hardship letter to her loan servicer after being told her filewas incomplete. The Elkhorn, Wis., resident was told a month ago that she’dreceive a decision soon, but she’s still waiting.

“If you give them everything,they should have an answer,” said Belanus, who saw her monthly paymentsdrop nearly $350 under the trial modification. “I don’t want to lose myhome because they take too long. It’s uneasy not knowing what’s going to happen.”

A Wells Fargo spokesman saidBelanus’ file is complete and is in the review process. She should be notifiedof a decision within 45 days.

Denied

0:00 /2:06A rarecase of mortgage reduction

Once their files are complete,borrowers may be denied long-term help if they don’t meet the program’scriteria.

At JPMorgan Chase (JPM, Fortune 500),for instance, some 29% of borrowers offered trial plans did not make therequired payments and are not eligible for permanent modifications, the bankreported. Another 51% have made the three required payments but have notprovided all the needed paperwork.

The bank has launched a program tocall borrowers 36 times, reach out by mail 15 times and make at least two homevisits to retrieve the required forms.

About 20% have met all the criteriaand the majority are expected to be put in long-term modifications soon, thebank said.

So far, some 4,302 borrowers atChase have received permanent modifications, while another 16,131 have beenapproved for long-term help. The servicer has offered trial modifications to199,033 borrowers.

“We continue to work very hardto convert customers from a trial modification to a permanent modification thatlowers their monthly payment, but it has been a struggle,” said Charlie Scharf,head of retail financial services at Chase. 

I got a call from someone call Florida home owners alliance.. and they said they will help me out with the loan modification and provide me a free consultation with one of their property counselors without any kind of upfront fee/ cost……. Including they will show me the best option for a loan workout and reduce my monthly payment to a much affordable one.

But the question here is that for the past 3 years, i have been circling around with my mortgage company (ASC) and everytime they send me some paper work to fill up application, back and forth.. its been taking a hell lot a time 3 years no answers or solutions.. called them up but i don’t get any assistance and i am really afraid that they will soon come after me and i will loose out my home in foreclosure and ruin my credit score. I have seen the govt. assistance program helping for loan workout.. but i think they have lots of people or homeowners to deal with that they will over look my situation.. So im just finger crossing if this helps me this time for a quick solution and process.. If anyone has got calls or records on them being forgery, please notify at the earliest.. i have checked in the website but found no such kind of them being scam artist or any reports of them.. so i will be giving it a try for the consultation cause im not loosing anything.. does mofication company really speeds up the process… or anyother modi-company.. refer it to me…..URGENT

My Answer:

Your bank is giving you the run around. There is a lot of chatter on the internet about doing it yourself – and go it alone etc… You can do a loan modification yourself, some people have a great result, others, like yourself, get the run around from their bank. 3 years seems very extensive and is in fact about the longest run around I’ve ever heard of. So it may be time to bring in a professional.

As a consumer here are some of the benefits using a professional firm brings to you:
1 – You don’t have to stress out about what is going on with your file. They’ll handle the hard negotiations with your bank. You go focus on bringing in more income or family… or whatever you want. A quality firm will have a regular reporting and feedback service to keep you up to date on what’s going on with your file.

2 – They have the specialized experience and knowledge that allows them to push deals through as fast as possible. They will know and be familiar with the laws surrounding the mortgage industry, state lending laws, RESPA, Tilla.. etc.. This knowledge is put to work on your behalf to achieve a successful outcome for you.

3 – They represent you and your interests with the bank. Banks care about themselves and getting their money – not in getting you the best modification possible. You hire an expert loan modification company because they have your best interests at heart – you are paying them… not the banks.

Just realize that you will have to pay for their services – just like any other professional / expert you would hire in any other area of your life. A professional company needs to get paid – they have rent, phone lines, staff, attorneys, and some profit that needs to be made so they can justify staying in the business. So expect to pay a modest fee for their services – most companies that are legitimate are going to charge somewhere between $2,500 and $3,500 for a successful loan modification.

Regarding the company that phoned you – I don’t have any direct experience with them but my recommendation would be to become an educated consumer. Talk to a few different companies and you’ll quickly get a feel for how the various companies operate and value your business.

Despite what some have said about our industry there are great and legitimate companies operating in this space that perform a great service to their customers. Your story is not unique in that many many consumers are getting the run around by their banks. At a certain point you have to say enough is enough and bring in a professional to get the job done right.

That’s my opinion on the subject. If you’re interested in more information I do maintain a blog called “All About Loan Modifications” the link is below in the resource box. Best of luck to you

You can also check out our site for more information at SureFast Loan Modification.com

If you have feed back or questions on this answer please leave them – we’d love to hear from you!

School of thought #1 – loan modification should be free

This is absolutely true.  In fact, anyone can apply for a loan modification directly through their lender and in most cases it will be free.  Zip, zero, zilch!  Free.  Many homeowners go this route and have some success working directly with their lender to get their home loan modified.

Also, there are government agencies that are set up to help homeowners in trouble that want loan modification advice.  If you want help or advice you can check with a HUD approved counseling agency at (800) 569-4287.  You could also check with your state department of real estate or similar to find out what resources are available to you at the State level to assist you with getting a home loan modification.  All of these options are free to you.

School of thought #2 – Higher a professional or expert modification company to get the job done right.

There it is hire… hire = money.  Well, that’s the truth of it, it’s going to cost some money to go down this path.  A Quality loan modification company is going to charge somewhere between $2,500 and $3,500 for their services.  Anybody that’s charging less I would seriously wonder if it isn’t somebody down in their basement negotiating with your bank.

Is it worth it.  Absolutely!  Why? Because a professional loan modification company is going to bring a lot more knowledge and expertise to the table than you have on your own.  Look, you’re an expert at what you do but more than likely you’re not well versed in the legal aspects of mortgage banking, state lending laws, RESPA laws, TILLA laws and all of the other legal aspects that go into a mortgage.  A professional mortgage company will have lawyers on staff or retainer that have expertise in these areas that they can bring to bear on your lender.

Also, an expert loan modification company is going to have already established relationships at all of the major banks.  When you as the consumer get turned down… they can reach out to these contacts and get the modification done.  These industry relationships have a lot of value when it comes to getting loan modifications approved.

Let’s be honest with each other for a moment – do you really think the banks care about you and getting the best deal possible for you.  Or is it more likely they are mostly concerned with their own bottom line and their own concerns.

As a homeowner, trying to do a loan modification on your own, you are more than likely not familiar with all the different types of deals your bank is structuring and giving out.  You wouldn’t know that if your bank offers you a fixed 5% rate that they gave a 4% rate to the next guy in a similar situation.  That 1% difference on a $200,000 loan would cost you an extra $42,772 over 30 years.   A professional home loan modification company will know what a good deal is and represents your interests with the bank – they’ll know what a good deal looks lie and if their worth their salt they won’t accept anything less than a good deal for you.

Finally, and I think this one is really one of the huge bonuses to clients of an expert loan modification company – you don’t have to worry about it.  If you’re trying to negotiate your own loan modification then you’re walking around stressed all the time wondering if you’re screwing it up, worrying about why the bank isn’t calling back, and wondering if you’ll get declined.  Engaging the services of a professional mortgage modification company relieves you of that stress and anxiety, and lets you enjoy your life a little more.  It frees your mind up to focus on your family, or work, or whatever you want.

For some homeowners there is a lot of value in having a professional on their team… for others… not so much.  Either way it’s okay.  As a consumer you need to choose the best option for you and then move forward and take action.

For more information you can visit our site at SureFast Loan Modification.

If you have any questions or comments please let me know.  I’d be happy to respond.

Answer:

Great Question. No you do not have to be behind on your payments….. but it sure helps. Even 30 days behind can be a miracle worker for you if you’re trying to get a loan mod.

You’ll have to make a good case to your bank as to why you deserve a loan modification when you are current on your loan. In the banks eyes they are just giving contracted money away. When you are late the ball game changes. They bank is now faced with the prospect of incurring additional manpower and expense to begin the collection process so all of a sudden it becomes more important for them to at least consider a loan modification.

You’ve really got nothing to loose by applying for a loan modification so go for it… see what they say. The worst your bank can do is say no. If you keep making your payments then you’re no worse off and you could be a lot better off – so just ask.

Also you may want to know that professional services exist that can assist you with your loan modification as well. Unless you are well versed in negotiation strategies and real estate law you may want to consider checking into that option. They do cost some out of pocket money but in most cases they are well worth it.

If you’d like more information on this subject check out my blog “All About Loan Modification” at http://surefast.wordpress.com.  Also check out our website at SureFastLoanModification.com.

I have been working with my loan provider America Servicing Company for a loan modification. It is a total frustration. For about almost a year back and forth, sending docs, phone calls etc. today I just found out that my house was sold on a foreclosure in October. Weirdly, in October, I have spoken to the one of their agents and was told that my loan modification is still under revision and if there is any foreclosure activity, it will be postponed till December. I was asked to call back in 2 weeks to check on the loan mod status, again.
2 weeks went by and I tried calling, once again, it is a merry go round. 2 weeks before Thanksgiving, I managed to speak to an agent and was told to resubmit the paperwork again (the 4th time through out the process) And I did. 2 days later, I called and was told that I need to sign and date at the bottom of the docs and resent it again. This was just last Friday after Thanksgiving.

Yesterday, I called again and was told that my house has actually gone through foreclosure and they do not know if it has been sold. I was given the number of their attorney to call and check. I found out that my house was sold in Oct 09 without any notice given to me at all. All these while, I was told that the loan mod is still under revision.
I checked with the county tax and the deed still have my name on it. The homeowners association file still has my name on it. Infact, I just paid one year of the HOA fees.
Is this legal? Can they sell your house while you are in process of loan modification? Can they sell your house without giving you any notice?

What can I do to get my house back?

Answer:

Yes, unfortunately.

Here’s the rub on this…. until a loan modification is granted by the bank they can enforce the original terms of your mortgage which include as a remedy for failure to make your payments – foreclosure.

It sounds like you received a foreclosure notice – or a notice of default. If you’re home had been sold you would have received a certified letter with a definite sale date. You would have had to sign for that document just like you did when you received your notice of default. If you’ve checked your county recorders office and they say you’re still on title (assuming they aren’t using paper and pencil to keep the books) you still own the place.

A request for loan modification does not guarantee that your bank will stop the foreclosure process. It’s their choice – if you don’t make your payments – and your bank is not co-operating they can proceed all the way to foreclosure – even while you’re loan modification is still in review.

Here’s my recommendation. Understand this is your house… if you want to keep it you need to consult a good real estate attorney – you need some professional help at this point. Foreclosure is not a do it yourself project – find a well versed real estate attorney in your area and pay them to find out what’s really going on in your situation – they’ll advise you as to what your options are. If you can’t find the help you need get in touch with me and I’ll point you the right direction.

I would also like to mention here that your situation is another example of why I strongly recommend that people choose a professional service to help them modify their mortgages. Look, this is your home, this is where you live, if you want to keep it paying a good solid company for their services is worth the money. They’ll get you a quality loan modification that will really benefit you long term and you won’t have all of this stress that you’re experiencing right now. A good company will be armed with the knowledge and skill set to handle these types of issues or better yet avoid getting into them in the first place.

I hope this gives you some direction. Best of luck to you. If you’re interested, I maintain a blog called “All About Loan Modifications” stop on by if you’d like: http://surefast.wordpress.com.  You can also check out surefastloanmodification.com.

Best of luck to you!

I applied the loan mod under home affordability plan in May 09. I was told my application has been disqualified from under affordability plan and then transferred to conventional loan mod plan. I have loan from Bank of America, backed by Freddy Mac. What’s the difference?

Answer:

Great question.

There’s a lot of confusion out there as to what the difference is between these two programs. To begin with a loan modification is a permanent revision to the terms of the loan.

Any lender has the ability at any time to modify the terms of your loan if they want to. The last part…. if they want to… is the critical part. Some lenders are definitely more open to loan modification than others. So understand this – any lender at any time can modify one of their loans – the only question is will they.

In March of this year the Federal Government announced the Making Home Affordable Plan which has two programs in it. The HARP (Home Affordable Refinance Program) specifically for people that owe more than their home is worth and want to refinance to the current low market rates. And, the HAMP (Home Affordable Modification Program) which is the program you’ve referred to. The HAMP program is designed to help homeowners that are in immanent danger of foreclosure.

The guidelines for the HAMP program are fairly strict. It sounds like you’ve applied for that program and been denied. If you’re sure this is the program you want then you should re-apply – you can apply as many times as you want. Your bank has been given a financial incentive by the federal government to modify the terms of your loan under this program for 5 years. Plus, in some cases if you qualify for this program you may be elidgable for a $1,000 principle reduction for each year that you make your payments on time for up to 5 years. That’s pretty cool if you qualify for it.

Okay, here’s the skinny on a HAMP modification – you’re going to find that if you do qualify AND you completed a 3 month trial payment period that your loan will be modified to a a low interest rate (as low as 2%), for the next 5 years and then it will adjust or bump up to today’s current market rate. So be prepared for that.

If you are declined for a HAMP modification again you can always reapply for a loan modification directly through your lender. They MAY be able to do something for you if you catch the right loss mitigator. However, you may find better success by engaging the services of a professional loan modification company. They do charge for their services but for most people that aren’t familiar with the rules and laws regarding mortgages – they will be light years ahead and save themselves a ton of frustration and money in the long run.

If you’d like more information on this subject check out my blog “All About Loan Modifications” that I write for at: http://surefast.wordpress.com.  You can also check out http://www.surefastloanmodification.com

Hope this helps!

I’m going true a hard time and i can’t pay the full monthly payment of my mortgage, i have never make a late payment yet but this month i think is going to be hard for me,someone told me to call the bank and try to negotiated my monthly payment what should i do? please give me and advice.

Answer:

Hi Ernesto, It’s tough times for a lot of people right now. I’m sorry you are struggling so much. Here’s my feedback on your situation. There are a few possible solutions to your situation..

1) Your lack of adequate cash flow is temporary and will increase back to its previous level. In this case you should definitely contact your bank, explain to them that you are experiencing a temporary setback in cash flow, and set up a repayment plan for the portion of the mortgage payment that you couldn’t make. They’ll take that portion that you missed and divide it equally over a period of time – say 12 months. You’ll receive some new paperwork from the bank stating the new agreement – you sign it return it to them and then start making your regular monthly payment again along with the additional monthly installment you agreed to… voila!

Another option your bank may choose if its severe enough is to just add the portion of the payment that you couldn’t make to the back end of the loan – in other words they add it back into the principle balance of the loan and you make a few more payments. There are lots of options if your situation is temporary – contact your bank and let them know what your situation is and they’ll let you know about the programs they have available.

2) Your cash flow is more of a long term ongoing situation. Now you need to look at another solution all together. You can do nothing – and… you’ll end up loosing the house to foreclosure because you broke your mortgage contract OR, what a lot of people are doing right now is requesting a loan modification. This is where the bank makes a permanent change to the terms of your loan to reflect your new lower income. This usually involves permanently lowering your monthly payment through a lower interest rate, extending the repayment period, forgiving some of the interest on a portion of the debt (a forbearance), or forgiving a portion of the principle all together (rare but it does happen).

Look, your bank doesn’t want to take your house – they just want you to make your payments. Call them and see what you guys can work out together. If you’ve got one of the big banks as your lender they’ll have programs available for you that you can access. If you do opt for loan modification be aware that there are professional services that exist that are there to handle this for you.

Loan modification can be a bit tricky unless you are well versed in finance and real estate law. If you’re not, if your not comfortable with these issues and you do opt to go for a loan modification you should check into using a professional to get the best results. After all, this is your home we’re talking about here… she deserves the best!

If you’re interested I maintain a blog “All About Loan Modifications” at http://surefast.wordpress.com

Best of luck to you!

I have one of those really cool four door Jeeps.  I love my Jeep.  I drive it every day.   But, when it breaks I don’t do the repairs, I take it to the dealership and let them repair it correctly.  I’m not a mechanic, I went to school for business management and finance – not to fix engines, fuel injectors, air conditioning systems, transmissions etc.. I leave it to the professionals – people that are trained on how to fix those particular parts.  This way I know the job is done right and I can sleep well at night knowing the Jeep’s not going to blow up tomorrow because I didn’t connect something right.

Your home mortgage works in very much the same way.  Unless you are well versed in mortgage banking, finance, negotiation strategies, and the law surrounding home loan lending – you’re definitely going to come out thousands of dollars ahead by engaging the services of a professional loan modification company.

It is true that you will have to pay the company for their services BUT I promise you, if you have chosen a quality loan modification firm, it will be worth every penny.  Even a 1% difference in interest rate of the life of your loan will wildly trump the investment you make in hiring an expert that deals with mortgage modifications day in and day out.

Let’s say you worked with your lender on your own and got them to agree to an interest rate of 5.5% on a loan balance of $200,000 for 30 years – your monthly payment is $1,135.58.  On the other hand, if you’d used an expert loan modification company they would have known that most loans similar to yours are being set at 4.5% interest (non 5.5%) and they fight for that and get it… you’re new monthly payment would be $1,013.37.

The difference between the two monthly payments over a 30 year time frame would be a total of $43,995.38!  And this is just with a 1% difference in interest rate.  What about waiving fees, forbearance of principle, even forgiving principle balances… there’s all kinds of financial benefits you get when you use a professional modification service.

I can promise you this…. The banks are playing for their own self interest.  I’ve seen some really ugly homeowner negotiated mortgage.   They’ve ended up with a temporary band aid and I’m willing to bet they will be right back in the same situation in a few years.

From one perspective you could say that, yes, the author is biased because I am consultant for an expert loan modification company, but on the other hand that gives me a unique perspective of  talking to hundreds of homeowners about what their banks have told them… and what their banks have offered them – and it’s not pretty out there!  Most of our clients are homeowners that tried to modify their home loan on their own.

Please heed my advice… from someone on the inside… use a professional firm with expertise in this area.  It will be worth every penny you have to beg, borrow, and scrape up to make it happen!

So, let’s talk about a forensic loan audit and why you may want to consider having one done as part of your home mortgage loan modification.

If you’ll wind the clock back 4 or 5 years ago – really up until the current financial crisis began, banks, lenders, and mortgage brokers were very relaxed in their compliance with federally mandated guidelines for lenders.  If your loan was created during this time period there was almost a 100% chance that it violates one or more laws relating to RESPA, TILA or Section 32. Not just the little banks – the big boys like Wells Fargo, Litton, AHMSI, PMC, GMAC.. and many others – were very relaxed in their interpretation of their compliance to these existing laws.

As a consumer, it’s not reasonable that you would be expected to know or be aware of all of the laws that pertain to lending… you went in your for mortgage closing and your title company, or they came to you, showed you where to sign and told you life would be great after you were done.  You relied on their expertise as a professional to obey the law.

When an experienced attorney performs a forensic audit on your loan they will review all of the documents you were presented with and signed at the time your loan was created.  They examine whether or not you signed the right documents, audit the math, examine the loan terms, perform a test to see if there was anything misleading about what was presented… etc.  When the attorney has completed the forensic audit they’ll provide you with a report of their findings.

Understand this, in sever situations, mortgages can be wiped out completely because of violations and infractions of lending laws.  So banks take the results of these audits very seriously.  If you’re in a situation where you are trying to do a mortgage loan modification a forensic audit can be your best friend – especially when the bank you are working with won’t play ball.

You’ll find that prices will vary from different legal firms as to their fee for a forensic audit.  I know attorney’s that specialize in forensic audits and they cost about $900 for the service.  In our company we perform forensic audits at no extra charge for our loan modification clients when banks are being stubborn – from experience they are VERY effective in obtaining a favorable outcome for loan modifications.

If you’re trying to do a loan modification on your own this may be a great place to start.  If you need a referral please e-mail the author and I’ll put you in touch with an expert in the field.  If you’re using a professional to help with your home loan modification be sure they have the forensic audit tool in their arsenal.

If you know you need a loan modification our team would love to help – we use forensic audits regularly – to obtain the best possible outcome for our clients.  Check us out at SureFast Loan Modification.com or (800) 510-1859 for faster service.

The primary objective of the Making Home Affordable Program is to help stabilize housing prices.  By helping you to stay in your home that puts one less foreclosure on the marketplace that ends up selling at a lower than market price – which in turn helps to stabilize the value of everyone else’s home around you.   The government believes that by helping to stabilize the housing market and help to keep people in their homes it will help to stabilize the broader economy.

The HARP program (Home Affordable Refinance Program) is designed for mortgages owned by Freddie Mac and Fannie Mae in which the homeowner can afford their monthly payments but is unable to refinance because they currently owe more than their home is worth.  Under this program Fannie Mae and Freddie Mac will allow them to refinance up to 105% of the value of their home at today’s market interest rate.  In order to qualify for this program you must have a satisfactory credit rating.

Regarding the HAMP program (Home Affordable Modification Program) – this program is designed to help people who are in foreclosure or going to be in foreclosure to keep their homes.  This program is designed to assist people who have suffered some sort of financial hardship due to a reduction in income such as the loss of a job for your spouse or experienced an increase in the mortgage payment as in the case of an adjustable rate mortgage that adjusted up.  The household must still have income however credit is not a factor.

Under the guidelines of the HAMP program your interest rate can be lowered to as low as 2% for up to 5 years, the bank may also extend the repayment term up to 40 years, and a portion of the principle balance of your loan may be placed on forbearance –  A big word meaning its still hanging out there but you don’t have to pay interest on it for a certain period of time.  If you sell your home – you’ll still have to pay that money back.  All of these factors are designed to get your mortgage payment down to 31% of your gross household income.

For participating lenders in the HAMP program the Federal Government has sweetened the pot by giving them an incentive to modify an applicant’s loan.  For each of the first five years of the modification the Feds will pay your lender a certain amount per month for accepting the modification.  In addition, as a homeowner, if you make your new modified payment on time you may be eligible for $1,000 in principle reduction for every year you make your payments on time – up to 5 years.

It is up to your particular lender to determine how they want to modify your loan – they don’t always have your best interests at heart so be careful.  If you feel the new terms they are offering you are going to put you in a worse situation down the road you do have options.  You should consult your attorney or a reputable company that regularly deals in loan modification such as SureFast Loan Modification.com.   These competent professionals can help to make sure you get the best deal possible and don’t get taken advantage of by your bank.