Home equity loan modification is a change in which you have an option to modify your mortgage if you are behind and having difficulty in your payments. This is the loan type wherein the one who borrowed will use the equity in their homes as collateral. This will be sometimes a useful element to facilitate major repairs in the home, college education or medically related bills.This type of loan generates a lien or a security interest against the house of the borrower and the actual home equity will be reduced. This is usually referred to as mortgages because the value of the property is secured against it; just the same as a traditional mortgage. Also, it can be possible to deduct one’s income tax from the home equity loan.The government is giving you options to avoid possible foreclosure in your costs; this is the home equity loan modification. First is to have your payment at your mortgage that is 31% more than your gross income which greatly includes your taxes, your insurances or homeowner dues that you might be paying. This will just show that you are really struggling with your payments. Second is when you use loan modification, this will make your mortgage be in much better shape than you can ever imagine.It will provide you with payments than you can afford and will make sure that you will never lead into foreclosure which in turn, will get back your credits and save your home. And the last thing you would do is to go online and start consulting. You will just fill out some forms about yourself and your status. It includes information about your home equity loan modification and later on, they will call you and give details to help you in saving your home.
October Bank of America home loan modification report shows increase in permanent home modifications and the report is as authentic as much as it is true. The important fact to highlight here is that on many previous occasion, homeowners have become critical of B o A and other servicers as they are in doubt whether they qualify for the program or not. Until recently many homeowners who are looking for in house or any other home loan assistance as the remedy to the modification efforts made from servicers like BOA. But with the October report of B of A Loan Modification, the story told is completely different. The report shows the increase in the permanent mortgage modifications. If we consider the September report of B O A, there were around 78,905 applications, but the latest October 31 report shows that there were 79,339 applications under the active permanent home loan modification. Many of the homeowners are struggling really hard to pay their mortgage payments on the BOA home loan, and this is also true with many other mortgage services as well. Many other banks acting as servicers are trying their level best to address the concerns of struggling homeowners to pay their monthly mortgages.Read through the October report of B O A and make your understanding on the Obama’s mortgage program. The program is devised for the homeowners who are not able to pay back their mortgage finance on time. If you are in the better condition to pay back the finance, you will certainly be having an upper edge than those homeowners who are least aware or half informed about the program. Bank of America has taken the lead to provide millions of desired homeowners with the mortgage modification process as it filed their loan applications. The bank has also played crucial role in alternative home loan assistance. Make sure that you discuss with the servicer the loan modification terms and conditions before you take the next step. Discussing about the mortgage modification with servicer will give you a fair idea on how good or bad you can go ahead with the auto loan.As the B of A loan Modification requirements go, there are many points which have to be considered by the homeowner before they apply. Moreover servicers, like Bank of America are doing very little to assist the desirous homeowners to understand the loan terms and conditions.
Sadly the news continues to pour in from across the country and no economic sector has been left out. It’s a pity families, numbering in the millions, have lost hope and continue to lose hope in President Obama’s loan program to help them put an end to the foreclosure situation and help them stay in their homes.Each day sees the bankruptcy of a major corporation adding to the increasing numbers of unemployed, with General Motors among the latest causality. This translates to an additional untold numbers of households that will lose their monthly salary along with the capability to meet their financial obligations on a monthly basis. This, in turn, translates to those same families having the inability to make their mortgage payments or to put a halt to the foreclosure of their home.If you’re unemployed and unable to afford the mortgage payments each month it’s impossible to put a stop to the foreclosure process. Each foreclosed home simply adds to an already glutinous market and continues to reduce prices below market level. This situation affects everyone and continues to go around and around and around.The current foreclosure numbers have reached a critical mass and President Obama’s efforts have had little effect on pacifying the more than 80 percent of homeowners on stopping the foreclosure process. While the intentions were honorable it seems to have, once again, gotten trapped in a bureaucratic stranglehold of red tape and those who could use the help in the worst possible way will have that opportunity.The established rules and regulations are so numerous and overwhelming that a significant number of homeowners battling to keep their home and stop the foreclosure proceedings find themselves unable to get past the first and basic steps of the plan to be included for consideration. This is really a sad situation and this really shouldn’t be the case during this point in time.For an unknown reason, the story continues to be repetitive and after being involved in the huge bank bailout, these identical banks are the same institutions that obtained the majority of the government program’s 75 billion dollars.A portion of this payout was as an incentive to collaborate with property owners. To make matters worse, despite the fact that they were given millions as a catalyst, they have chosen to deal with financially sound mortgages. Everyone else is simply out of luck.All homeowners who have been unable to meet the qualifications of Obama’s Loan Modification Program, up to now, still have options and can cancel the foreclosure process and remain in their homes; the opportunity continues to exist despite the fact that you may be unemployed or without a monthly or annual income.There are a number of methods available to you that will allow you to remain in your residence for an extended period of time. In various situations this could equate to a couple of years or more. However, each step of the process needs to be understood.Right now, your best option is working out a plan of repayment, for all past due payments, with your mortgagee. While this will feel like the least viable solution, the main idea is to put a stop to and postpone the foreclosure process until a better solution presents itself at a later date. However, you need to remember to use caution; it’s important to have the knowledge necessary to work with your mortgage company during this critical time.
A HELOC loan, formally known as a Home Equity Line of Credit, is granted for a specified amount of time and the collateral is the equity in your house. Here is where the difference comes in with a HELOC loan; all of the money is not disbursed at one time. Basically, it is a line of credit that can be used accordingly, not to exceed the maximum loan amount. It is very similar to using a credit card.Once you have closed on the loan you will know what your loan amount is. The time that you can use the money is called the “draw period” and it is usually between 2-25 years. Your payments will only be what you have used against the HELOC loan and if you stay within the minimum then you may only have to pay the interest on a monthly payment.However, if you exceed the minimum then you can decide when and how much you want to pay back. While that may sound great, keep in mind that once the “draw period” is over the full loan obligation must be met. This is done either in a balloon type payment or according to a loan amortization schedule.It is different from a conventional loan in other respects too. HELOC interest rates vary according to the prime rate. What this means is that the interest rate will change. A word of caution is that all lenders do not calculate the margin the same. The difference between the prime rate and the interest rate determines the margin which is the amount that borrowers pay.HELOC loans are very popular, especially in the US. Because the interest that is paid is tax deductible on both federal and state taxes has made this type of loan one to seek. More people like these loans because they are also very flexible in the sense that they can be paid back however and whenever the borrower chooses to do so.Regardless of the terms and the flexibility, the bottom line is that this loan must be paid back, plain and simple. The collateral is your home and if you fail to pay you will face foreclosure. Always keep this in mind when you are considering a HELOC loan.Are you facing the likelihood of a foreclosure? Do you need help with your debts? Why NOT take advantage of a free consultation with experts?
Today there are many home owners that have paid their mortgage on time, but have found themselves in an adjustable rate mortgage, that has adjusted or is scheduled to adjust in the near future. Now they have good credit, good mortgage history, but the problem is they cannot refinance as they owe more than their home is worth. Well so they’ve been told, but one insider secret option that is available to home owners in this situation is a short refinance.If the above scenario describes your situation, then your first step towards a short refinance is to contact your lenders Loss Mitigation department to see if they would be willing to participate in a short refinance. If they say NO, then you will want to ask what other options are available to you, such as a loan modification, and IF they say yes, then great, you now need to find a short refinance expert to get the ball rolling.You will want to find a Mortgage Expert that has experience with loss mitigation and who specializes in Short Refinances. This is not time that you want to just pick any mortgage broker from the yellow pages or to let the family friend that is a mortgage broker use you as a guinea pig. Short Refinances are a complicated transaction and require a lot of attention and a great deal of knowledge of the loss mitigation procedures.Now to start the process you will need to contact you lender and let them know you are considering doing a short refinance and to send you the short refinance package. In this package you will have to fill out an application, a personal financial statement that will list all you income and expenses, 2 months recent bank statements, 2 years tax returns, current paystubs and a hardship letter. The hardship letter is simply an explanation of why you can no longer afford your mortgage payments and why you need to refinance. You want to make these letters simple and to the point, no need to write a 50 page essay.The next step is to get pre qualified with an FHA Lender, the reason FHA Lenders are preferred is because they will give you the highest LTV possible which will make your offer to your current lender more attractive. Once you have the approval you will want to put it with your short refinance package and submit to your lender for approval.Once the package is received, then your lender will order a BPO (Brokers Price Opinion), this is similar to an appraisal, but is an inspection normally performed by a real estate broker in the area to give the lender an idea of the current market value. Once the BPO is reviewed, the lender will give you an offer for the new payoff amount.From here you will want to proceed with you new FHA Loan, which will require a separate FHA appraisal, hopefully the appraisal will have the same or similar value to the BPO, if there is a significant difference, then your mortgage broker will have to go back to the lender and renegotiate. The ideal situation is to get you refinanced without having to bring any money to the closing table, but in some cased the lenders will not bend, and to make the deal work you will have to bring some cash to close.Once the mutually beneficial agreement has been reached, then the lender will issue a release of lien. This document will show what the lender will accept as a net payoff.
A loan modification is when a borrower has the terms of his or her mortgage modified in order to make the loan more affordable. This is done when a loan becomes too expensive and a borrower finds themselves struggling to make their monthly mortgage payments. Generally, modifications are completed in situations where a borrower may be facing foreclosure unless the loan is made more affordable, yet they are unable to refinance their loan, due to insufficient equity in the home.An FHA loan is a mortgage loan that is backed by the Federal Housing Administration. These loans were created to be more affordable than conventional loans, as well as easier to obtain. This helps families with moderate or low incomes and less than perfect credit, become homeowners, even though they would be unable to qualify for a conventional one.The Differences Between Mortgage Modification and FHA Loans:The main difference between loan modification and FHA loans is that an FHA loan is a federally insured, affordable loan, while a modification refers to changing the terms of a loan. A home buyer could obtain a FHA loan while purchasing a home, but could not modify their loan until the payments became so expensive that they were unable to pay. A modification is usually not obtained until a homeowner’s financial situation becomes so dire that they are facing foreclosure.Additionally, mortgage modifications are completed on loans insured by Freddie Mac or Fannie Mae, not by the Federal Housing Administration. When FHA ones become too expensive, they are usually refinanced, not modified, as refinancing is an easier process to qualify for. This is because of the Hope for Homeowners program, which allows homeowners to lengthen their loan to 40 years, refinance 96.5% of their home’s value, and be excused for any debt over 96.5% of the home’s value.The Similarities:The main similarity is that these programs were both designed to help homeowners avoid foreclosure and be able to afford their mortgage. The Hope for Homeowners program also makes refinancing an FHA loan decently similar to a loan modification. This is because this program forces lenders to forgive any debt that a homeowner has over 96.5% of the value of their home, while allowing homeowners to change the terms of their loan to make it more affordable. Therefore, while there are differences between FHA loans and loan modifications, there are important similarities that will help homeowners avoid foreclosure and improve their finances.
Denied for refinance? If you have, it’s not the end of the world and there is lots of hope. Lots of it in fact. I’m going to outline in this short article a super easy strategy for getting approved for a loan that could literally save your home.#1 Reason People are Denied Refinancing
Many people who try to get a refinance on their existing mortgages do so without fully assessing their situation. The key thing they ignore is the number of payments (if any), that they’ve missed. What people fail to realize is that if you are missing payments, the lender will see you as credit risk. In other words, if you can’t make existing payments, how are you going to make the new one?Missing payments will be a big red flag and is the number one reason people are denied for refinance. Luckily there is a simple an effective way to get a loan for your home without going the refinancing route,Loan Modification is the Answer
Getting back on track is easy with loan modification, particularly the scheme proposed under Obama. It’s a bit like refinancing, only it’s federally approved and your chances of being accepted are very high indeed. Under the Home Affordable Modification Program (HAMP), people who are facing financial difficulty are a priority.Finding a loan modification company to handle your application is also very important, particularly if you’ve been denied for refinance. There are lots of them who operate online and you can usually get the first consultation free. Here, they’ll take a detailed look at your circumstances and prepare the best application for you.So there you have it; a simple yet powerful exit strategy for anyone who has been denied for refinance. It works, so by all means, try it.
Wells Fargo is currently accepting loan modification applications from people who are interested in the Obama Federal program. This program is known as Home Affordable, or HAMP. This program is currently designed to offer loan modification help to a little over five million people. Of course, the program does not help everyone. There are certain guidelines that you must pass before you receive help on your mortgage.Who Can Apply to the Home Affordable ProgramAlmost anyone who is currently experiencing financial problems as a result of a too expensive mortgage payment can apply to the Home Affordable Program. All you need to do is ask Wells Fargo for help. If you have been declined for loan modification help or if you are currently going through the application process for loan modification, you still have a chance at the program that is offered by Wells Fargo. All you need to do is pass certain qualifications. For example, a good candidate for this program is someone who has a mortgage loan that originated before January 1, 2009. In addition, the amount owed on the loan has to be less than or equal to $729,750. If you owe an amount that is more than this, you will not be able to receive help through Wells Fargo and the Home Affordable program. In addition, your current loan mortgage payments have to be less than thirty-one percent of your gross monthly income. This includes your taxes, your insurance, and your homeowner dues.You should apply for HAMP as soon as possible. This program only has a limited amount of government funding available. There are millions of people asking Wells Fargo for help. You should ask for your help before funding runs out.Applying for HAMP from Wells FargoBefore you can apply for HAMP, you will need to prepare a financial statement. This statement has to list all of your monthly expenses and your current income. It will allow Wells Fargo to figure out if you can qualify for HAMP.If you have two loans, you can receive loan modification help for both loans. Your rates on the second loan can be reduced to one percent. It could even be eliminated. The Department of Treasury will pay the lender with a subsidy.If you do not understand HAMP, you should ask a professional for help. He or she will know how to complete your application and provide all of the needed documents.
Seeking home loan modification help is a very important decision that must be taken seriously. Often people take a casual approach and find themselves being rejected by lenders. This brief article will give you the tips and strategies that will ensure your success.Home Loan Modification Help – Why Most People are Turned DownIn very simple terms, any lender before they grant a loan must assess the applicant on their ability to repay. This point is crucial. It’s a no brainer, but you’d be surprised at how many people seek loans for say $30,000 when their existing total expenses way surpass that. Simple maths will tell you before you even fill in an application that such a variance will only spell disaster.The key, therefore, is to work out beforehand just what you can afford to borrow based on existing expenses and liabilities. Also when doing this sort of thing, it’s important to be honest on your application. Lenders have so much access to our personal data nowadays that it’s pointless to lie about your real financial situation.A loan modification is still at its core a ‘loan’. Too many people seek to improve on their homes without realizing that despite any potential value that might be added to the home, lenders really just see the amount as loan. To complicate matters, many borrowers seek the money to add things to the home that adds no value at all. From the perspective of the lender, it looks like a bad financial decision and these people not surprisingly are often turned down.Home Loan Modification Help – So What If You Been Unsuccessful?People are turned down all the time for home modifications loans. There are several ways round this, but by far the most effective is to seek the help of professional loan modification companies. These companies specialize in getting people who have had difficulties in the past, securing a loan to modify their homes.The industry, like many branches of lending, is heavily regulated by federal and state law. Nonetheless it is important to do your own due diligence to avoid getting ‘burned’. Also, aside from getting you loan modification help; these companies are usually very good at securing very favorable interest rates on these loans. So not only will you have a nice modification to your home, you’ll also have some money to spare. Now that’s what I call a real bargain.
A review of the FHA updated guidelines to the short refinance modification for struggling homeowners who are current but have lost value in their home.With the ever increasing rates of foreclosures and homeowners walking away from their homes, the government has announced a revision to the short refinance modification. Announced back in March 2009 the Home Affordable Modification Program has helped thousands of struggling home owners to stay in their home. However, there is still certain areas of the country that has seen such a devaluation of their property that these homeowners are choosing to walk away. Below are some of the basic requirements for this new short refinance modification.
Must be current on your mortgage
Have a non FHA government mortgage loan
Must be your primary residence
A minimum credit score of 500
First mortgage lien must be willing to write of 10% of mortgage principal reduction
Loan to value ratio should be no more than 97.75 %
2nd lien’s must be willing to agree to full and or partial write off
This new short refinance will only be available to those homeowners whose lenders are willing to participate and are in the targeted areas. IF you cannot keep your home and refinancing is not an option you may want to consider applying for a loan modification. In some cases, lender’s may reduce principal as part of the loan modification. However, it is very far and it is not a common practice with lenders, but you may get some assistance by exploring your options and knowing your rights.