If you are struggling to make your mortgage payments, a mortgage modification can be a lifesaver. A mortgage modification can reduce your interest rates and/or payments. Unfortunately, mortgage modification approval can be very hard to come by as the vast majority of applications get denied. That is why, if you are applying for a mortgage modification, you need to have everything in order. This will not guarantee that your application will be accepted, but it will greatly increase the likelihood. Here are 5 things that you should have ready when you apply for a mortgage modification.
Proof Of Economic Hardship
Many banks require mortgage modification applicants to provide proof of economic hardship (even if the bank doesn’t require it, it will certainly help your case). “Economic hardship” could stem from lost employment, crippling medical expenses, or any number of other issues. Economic hardship could even entail a sudden increase in living expenses. In some cases, you may only need to write a letter explaining your financial difficulties.
Proof Of Income And Expenses
When applying for a loan modification, you will certainly need to provide proof of income, and you may need to provide proof of expenses too. For proof of income, you should bring tax returns, pay stubs, bank account information, and information concerning your assets. Proof of expenses would include bills and statements. In general, the more paperwork you can bring, the better. Too much paperwork is better than not enough!
Know Your Mortgage Modification Plan
Before you apply for a mortgage modification, you should also know what type of plan you are eligible for. Depending on your situation, you may be able to apply for a mortgage modification plan with more generous terms. For example, if you have a VA loan (given to military veterans, active duty service members, and surviving spouses), you may be able to apply for a special loan modification. You may also qualify for special loan relief programs if you have an FHA loan.
Know Your Credit Score
One of the downsides of a mortgage modification is that it can adversely affect your credit score. This is because your lender will likely report the loan modification to national credit bureaus. That is why it is important to know your credit score going in. Once you know your score, you can work toward improving it. The good news is that mortgage modification does not bring your credit score down forever, and it is much less detrimental than foreclosure.
Call A Lawyer
The best thing you can do is call an experienced loan modification attorney at Galler Law. This will greatly increase the chances of your application being accepted. An experienced attorney knows how the process works, and can help you work through it. Galler Law has helped countless Georgia residents successfully apply for loan modifications. If you need to go through this process, call Galler Law today.