A loan modification is a process of modifying your existing loan to make your payments more affordable.

Over the past couple of years, many families have found themselves in financial crisis.  New programs including Making Home Affordable have been implemented making it easier for families to keep their homes and stop foreclosure – via loan modifications.  If you qualify for a loan modification your new payments of principal and interest, taxes and insurance will be reduced as low as 31% of your gross income, enabling you to keep your house.

Additionally, homeowners provide their lender with documentation in an attempt to:

• Reduce Your Monthly Payment
• Lower the Interest Rate
• Extend the Term of Your Loan
• Reduce Your Principal Balance

Due to the recent economic downturn, values of many homes have diminished.  They have even declined to the point where many homeowners owe much more than their homes are worth.  Lenders typically do not refinance homes where the property is over-encumbered.  Therefore, refinancing, even with good income is not possible.

Below is a chart reflecting the advantages of a loan modification.  Please note that there are no costs associated with a loan modification except for the cost of hiring a quality, professional company such as Legal Modified Loans, Inc.  Our fees start as low as $500.00

Making Home Affordable was designed to help three to four million Americans in financial trouble or in imminent danger of losing their home.  Not all lenders have agreed to the terms of this newer program.  Therefore, who qualifies for what kind of modification is tricky.
One of the key components of qualifying for a loan modification is hardship.  You must have hardship and income in order to qualify.  Here’s the problem…if you make too little income you don’t qualify, if you make too much income…you don’t qualify.

We recommend that you speak with an expert before you speak with your lender.

A successful loan modification is a permanent restructuring of a loan where the homeowner and his family stay in the home.
Each modification is tailored to the unique situation of the borrower.

In many cases the interest rate is lowered to a more affordable fixed rate loan based on 31% of gross income for a five year period.  The loan would then become fixed for the remainder of the term, either 30 or 40 years.

Word of mouth is usually good.  But, investigate the owners of the company and see if there are any complaints against them.  You can see if a real estate broker is in compliance by looking up their name on the California Department of Real Estate Web Site: www.dre.ca.gov  or by contacting the California State Bar Association and looking up the status of Attorneys.

Most loan modifications are pretty standard.  If your modification is for a principal residence and you are not planning on suing the lender, then you probably don’t need an attorney.
In most instances, the lawyer has legal assistants doing the majority of the work.  If you call the law firm, the lead lawyer will most likely not know anything regarding your home loan.  Why pay $3,000 - $5,000 for someone who does not know who you are?

Absolutely, and they want you to call them. Why? …because they want you to deal with them directly.  But they are looking out for their best interest, not yours.  All the lender cares about is the money… their money.  They will not structure your financials to fit modification guidelines.

If you continue to miss either mortgage payments and/or credit card payments your credit scores will further decline.  With that being said, most people who start a modification start it too late.  Depending on who owns your loan, Fannie Mae, Freddie Mac or an investor will determine if you need to be late on your loan or whether you can be current on your loan but in imminent danger of hardship.  If you are current on your loan, only a few programs will help.

One of the requirements for a loan modification is hardship.

By definition, hardship can be many different things including the following:

• Illness
• Death
• Divorce
• Loss or Reduction of Income
• Interest Rate on a Variable has changed or will soon change thereby creating an excessive expense

Many loan modification companies and attorneys charge between $3,000 and $5,000.
We started our company with the intention of helping as many people as possible with fair and reasonable rates.
At Legal Modified Loans, you pick your service level for as little as $500.

There is no short cut for a loan modification.  The process can be long and drawn out.  With that being said, once the modification is completed families are back on the road to financial stability.  Payments that were $2800 a month can be as low as $1800 per month.  Not only that, new payments are principal and interest payments while their previous mortgage was interest only.
Many modifications are taking 3-4 months if not longer just to get into the trial modification.  Once the trial modification has started, it is critical that all payments are received on time.

It’s important to note however, that if you are even one day late, you can be kicked out of the program.

You’ve submitted paperwork for several months and now the lender has verified all of your income, assets and expenses. You should be hoping to get approved for either one of the governments Making Home Affordable Programs or one of the lenders own workout programs.  Once you are approved, you will get sent paperwork for a trial modification indicating payments and all terms and conditions of the trial modification.  This is a three month probationary trial period and all payments must be received on time.  When the trial modification is completed, the lender will further review your modification including income and expenses and determine at that point in time whether or not you still qualify.  Once the final review has been completed, the final paperwork will then get sent to you to complete the modification.

Common Myths
With all the rumors spreading around, there are many misconceptions concerning loan modifications.  Some of them include:

• The lender wants to foreclose on my property.
• The lender cares about me and my family.
• The federal government requires the lender to give me a modification.
• The more in debt I am the greater the likelihood that the lender will give me a modification.

None of these are true.  They are all misconceptions or falsehoods.

Know Your Options
If you are having financial problems contact Legal Modified Loans, Inc. and we will help you understand all of your options.
Contact professionals who can help you.  If they give you advice, have them put it in writing.

You have choices:

• Forbearance – Pay your existing mortgage plus a repayment plan for the amount owed.
• Loan Modification
• Short Sale
• Deed in Lieu – Give the title and the property back to the lender along with the keys.
• Deed in Lieu Leaseback - Give the property back to the lender then lease from the lender.
• Bankruptcy
• Bankruptcy then Loan Modification
• Refinance

We will offer you a simple straight-forward and honest loan process designed to meet your budget.

Additionally, we provide:

• Personalized, confidential customer service by a veteran real estate broker.
• 24/7 Answers to questions and concerns.
• No Appraisals.
• No Closing Costs.
• No Equity Requirements.
• No Minimum Credit Scores

Since we deal in loss mitigation every day…with just one consultation, in as little as 20 minutes, we can tell you the likelihood of you qualifying for a loan modification.

A division of Proven Real Estate Solutions, Legal Modified Loans, Inc. has been dealing with situations like yours for years.  With nearly 25 years of experience, we have the resources to help you.  We are committed to doing what is best for you and your family.

Our Loan Modifications start as low as $500.00*
Call us today for your FREE Consultation!
800-658-7885
*Not all homeowners will qualify.

• Hardship Letter: Your lender wants to understand your current financial situation, what the problem was that caused the delinquency and how you have solved or intend to solve the problem.

• Financial Analysis Submission Form: A completed Income/Asset and Expense Form.

• Copy of Drivers License and Social Security Card

• Mortgage Coupons: For all mortgages, 1st mortgage, 2nd mortgage and Home Equity Line of Credit (HELOC)

• Tax Returns:  All pages of the last two years Federal Income Tax Returns

• Bank Statements:  Copies for the last two months of all bank statements

• Pay Stubs:  Copies of the last 2 paychecks for all borrowers, (one full month of income)

• Other Income Verification:  Verification of all other sources of income.               Example: Disability, Unemployment, Social Security Benefits, Rental Income

• Notices:  Copies of all legal notices you have received from your lender (s)             Example: Notice of Acceleration, Notice of Default, Notice of Trustee Sale

• Insurance and Property Taxes:  Copies of your Homeowners Insurance statement and your Property Tax statement.