The economic pinch is fast becoming a bite these days and more and more people are facing foreclosure. Getting things right in terms of loan modification qualification is becoming increasingly important and in this short article, I’ll outline the three absolutely important things to consider when making an application.
As you know, the Home Affordable Modification Program (HAMP) enacted under President Obama prescribes financial help to any American who is facing financial difficulties and are at risk of losing their home. Qualification under HAMP is not automatic however, so here are the three things to get right…
1 – A Winning Hardship Letter
This will form one of the crux of your application. The hardship letter should detail vividly your existing financial circumstances, what caused you to fall prey to financial hardship and any remedial action taken if any, to fix things. It must not be overtly ‘pleading’ but nonetheless, you need to make a strong case for why you need to be considered. Bear in mind that there are hundreds of other people vying for the same assistance. Your letter must be heartfelt as well as convincing.
2 – Get Your Income / Debt Ratio Correct First Time
The income debt ratio is an important part of loan modification qualification. The federal guideline stipulates that your monthly mortgage payment must exceed 31% of your gross monthly income. Anything below this threshold will have a hard time being approved as it will fall outside the parameters of proper means testing. Once you calculate your ration and it means the threshold, you can confidently move forward. I should also mention that the greater you exceed the threshold, the higher your chances of success.
3 – Cut Expenses
This is a very big point to remember. If you are having difficulty paying your present mortgage, the lender will look closely at your monthly expenses with a microscope. You will need to demonstrate that once the modified loan is granted, you will still be able to make payments. Of course this means that any unnecessary expenses that you have presently will have to be trimmed or eliminated entirely. The lender will deny your application if you are seen as living excessively.
Use the above three tips in conjunction with a professional loan modification submission and you are assured of loan modification success. You can find professional loan modification assistance online and most companies will give you a FREE consultation.