5 Things that you should consider before applying for mortgage modification
If you have been unable to make monthly mortgage payments for many months, then you should opt for mortgage modification. However, there are few things that you should consider before applying for mortgage modification program.
This article highlights 5 essential things that you should take into account before applying for mortgage modification. Things to consider before applying for mortgage modification The 5 things that you should take into account while applying for mortgage modification are given below:
1. Your home’s value: Using online resources you have to convince your lenders that the value of your house is far less than the value of your mortgage balance. One easy way of doing this will be to compare the price of your house to the price of a similar sized house in the same locality.
2. Prepare a Hardship letter: While applying for mortgage modification application, you should present a convincing hardship letter to the lender. You have to describe your current financial troubles. You need to explain why you can’t make monthly mortgage payments. The letter should be brief and short. You have to also enclose relevant documents with the letter which are essential for getting your mortgage modification approved.
3. Your Mortgage Debt to Income Ratio: You must know that you can’t qualify for mortgage modification program unless your monthly mortgage payments does not does exceed 31% of your gross monthly income.
4. Your Household Income and household expenses: Lenders are here for doing business and not for charity. They want to be sure that you will be able to make payments after getting the modified loan. You will have to show the lenders your income and expenses. Lenders will also check your disposable income after the expenses are deducted. Therefore, have copies of your paychecks or other proof of income (for at least 2 months), copies of tax returns, copies of all of your paid and unpaid bills for the past year.
5. Save money: You need to save as much money as possible. You must know that you have to save the money that you would have used in making mortgage payments. Even if you qualify for a mortgage modification, the lender may ask a lump sum amount to start the mortgage modification. You might be out of luck if you don’t have any money available.
These are the 5 things that you should take into account before applying for a mortgage modification program. If you still have some doubts, then you can talk to a qualified mortgage modification attorney before proceeding forward.