In many instances a mortgagor is set up on a forbearance plan prior to completing a loan modification which allows a mortgage company to monitor the economic condition of a mortgagor during the special forbearance period to be sure the mortgagor will be able to make payments. There are important documents required that are reviewed by a mortgage company Hardship Letter: To meet the criteria for a loan modification mortgagor must have a compelling hardship. The hardship must be known and given as many details as possible to sustain your case. A is very subjective and pretty much a requirement in the course of getting a loan modification. There are a few adversities that are considered voluntary and do not qualify quitting employment or decreasing the amount of hours worked are typically not accepted. The adversities are known and if there is an additional default the mortgagor can not use the same reason for default otherwise their previous adversities was really not over and in many instances the mortgagor is denied a loan modification. Financial Statement: This is used to determine the mortgagor ability to pay. This is typically the first form reviewed by the mortgage company mediator. This form must clearly indicate monthly salary and operating cost as well as current assets and liabilities. This is what makes and breaks the entire loan modification review. This form also shows whether or not the mortgagor will be able to make payments if the loan is modified. There must be a surplus salary at the end of the loan modification or else the plan will be denied. The plan must be affordable. If a mortgagor is severely over-leveraged with debt there is little chance that a loan modification will cure the delinquency. Monthly operating cost are reviewed to determine what bills are necessary and what are unnecessary. Necessary operating cost are food, utilities and gas and an example of unnecessary are entertainment operating cost, expensive phone plans and unsecured debt. Household operating cost loan payments, utilities, and taxes take up most of the monthly budget. Do not make expenses look unreasonable will be a red flag to get further detail. The negotiators will always look for assets that can be liquidated. Proof of Income: The proof of salary is usually a paycheck stub, a P&L Profit and Loss Account if self employed, or checking account statement showing paycheck deposits. The proof of salary is required to prove the mortgagor has steady salary. The mortgagor must also give frequency of salary. The proof of salary must correspond with the salary shown on the financial statement. Resolve any discrepancies
About the Author:
Donald Morris the writer of Stop Foreclosure. There is more information about loss mitigation at Help Stop Foreclosure. Also read our blog about Loan Modification Help
Sat, 26 Jul 2008 20:30:55 - 100%
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