Atlanta Loan Modification
Our lawyers can explain your legal rights about how to stop a foreclosure sale. We have been doing debt work for over 30 years in Atlanta, GA.
Galler Law Firm has 30+ years of experience helping people just like you get a fresh start. When it comes to your future, experience matters.
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If you’re behind on your mortgage payments, sometimes you just need a break. A loan modification can help you by reducing your interest rate or payments. Learn more below and feel free to call Galler law for a free consultation regarding your mortgage situation.
Home modifications are a powerful tool to help struggling homeowners, avoid foreclosure without filing bankruptcy. However approval rate for those who apply is very low, and our clients are often simply left in frustration.
Over the last 30+ years, Galler Law has helped hundreds of people just like you successfully modify a home loan.
There are now new programs available that offer even more options, and recently our firm was invited to a workshop by one of the nations largest lenders to review the new guidelines.
We can help move missed payments to the end of the loan, reduce monthly payments and interest, and reduce principle loan balance to help you avoid foreclosure.
Loan Modification Advantages
There are many advantages to modifying your home loan to prevent foreclosure. Keep in mind that these are examples and may not apply in every case.
Missed payments moved to the end of the loan rather than having to be paid back along with regular payment. This helps ease the burden on you in the short term, but lengthens the term of your mortgage.
Your interest rate can also be lowered or changed from adjustable rate to fixed rate. This can help lower your monthly payments.
If real estate is worth less than mortgage balance the amount of the loan can be reduced to the value of the home. Working with your lender, we can ask for a reduction in late fees or penalties, which can help you get caught up on payments.
We can also lengthen the loan to help lower your payments. If you have had a home for six years, we can lengthen your mortgage back out to 30 years in order to reduce the monthly payment without impacting your equity.
If your income is the issue, in some cases we can cap the monthly payment to a percentage of household income.
Chapter 13 Advantages
- Creates an “Automatic stay” upon filing to stop collection actions of all creditors, including foreclosures.
- Arrears are paid back in 60 months at no interest with no changes to the loan. ( You must also continue to make regular loan payments also)
- If there a second lien on the home and the home is worth less than the first lien, the second lien and be stripped off, however you must complete Chapter 13 ( up to 60 months) for lien strip to be effective.
If you are currently in a Chapter 13 Bankruptcy and paying large mortgage arrears in your Chapter 13 plan, we might be able to lower your Chapter 13 plan payment, or allow you to get out of Chapter 13 totally.
Read more information on foreclosure defense.
Answers to Frequently Asked Questions
A Loan Modification is a permanent change in one or more of the terms of a Borrower’s loan, allows the loan to be reinstated, and results in a payment the Borrower can afford.
How many Loan Modifications may a Borrower receive?
Borrowers are permitted to receive a Loan Modification or FHA-HAMP only once within a 24-month period.
How does a lender determine a borrower’s eligibility for a Loan Modification?
Lenders are to use specific financial analysis criteria when determining a borrower’s eligibility for the Loan Modification Option:
- The household or mortgagor(s) has experienced a verifiable loss of income or increase in living expenses.
- One or more mortgagors receives “continuous income” in the form of employment income (e.g., wages, salary, or self-employment earnings), social security, disability, Veterans benefits, child support, survivor benefits, and/or pensions.
- The mortgagor’s surplus income is at least $300 and is at least 15 percent of his/her net monthly income; 85 percent of the mortgagor’s surplus income is insufficient to cure arrearages within six months.
- The mortgagor’s monthly PITI mortgage payment can be reduced by the greater of 10 percent of the original monthly mortgage payment amount and $100, using the Market Rate and amortizing the new loan over 30 years.
- The mortgagor has successfully completed a 3-month Trial Payment Plan based on the reduced mortgage payment amount or a 4-month Trial Payment Plan in cases of imminent default.
- The mortgagor has not received a Loan Modification or FHA-HAMP in the previous 24 month period.
When utilizing the Loan Modification option, may the lender include all fees and corporate advances?
Yes. Legal fees and related foreclosure costs for work actually completed for the current default episode may be capitalized into the modified principal balance.
May a lender perform an interior inspection of the property if they have concerns about property condition?
Yes. The lender may conduct any review it deems necessary to verify that the property has no physical conditions adversely impacting the borrower’s continued ability to support the modified mortgage payment.
May a Lender include late charges in the Loan Modification?
The lender is expected to waive all accrued late fees.
When completing the Loan Modification Option, what interest rate should the lender use?
The lender should modify the interest rate to the current Market Rate, defined as a rate that is no more than 25 basis points greater than the most recent Freddie Mac Weekly Primary Mortgage Market Survey (PMMS) Rate for 30 year fixed-rate conforming mortgages (US average), rounded to the nearest one-eighth of one percent (0.125%), as of the date a Trial Payment Plan is offered to a borrower.
Are Lenders required to re-amortize the total amount due over a 360 month period?
Yes, the Lender must re-amortize the total unpaid amount due over a 360 month period from the due date of the first installment required under the modified mortgage.
Are lenders required to perform an escrow analysis when completing a Loan Modification?
Yes, Lenders are to perform a retroactive escrow analysis at the time of the Loan Modification to ensure that the capitalized delinquent payments reflect the actual escrow requirements required for those months capitalized.
Can a lender qualify an asset for the Loan Modification option when the borrower is unemployed, the spouse is employed, but the spouse’s name is not on the mortgage?
Based upon this scenario, the lender should conduct a financial review of the household income and expenses to determine if surplus income is sufficient to meet the new modified mortgage payment, but insufficient to pay back the arrearage. Once this process has been completed the lender should then consult with their legal counsel to determine if the asset is eligible for a Loan Modification since the spouse is not on the original mortgage.