Loan Modification Qualifications

So, what exactly are the qualifications for a homeowner in dire straights to stop foreclosure of their beloved home? The application by itself already seems very complex. However, this fear should immediately be dispelled because it only serves to deter one’s drive to fight foreclosure. Remember that as was explained above, foreclosures do not benefit anyone. They do not even benefit the banks. This and the addition of the government stimulus are great reasons for them to want to help you out in your mortgage situation. The process is doable. All that is most necessary is to actually qualify.

Also, your credit and your monthly income numbers are not the most important factors in either getting your payment rate adjusted. What is specifically looked at is if your mortgage eats more than 31 percent of your monthly income.

Foreclosure is also bad for the banks since they do not get back the value of the mortgage balance since the repossessed house’s value will likely drop considering that real estate prices are down. Also, fore every foreclosure sign, property around the area also goes down. This is the reason why the Obama bailout program funded banks and lenders with cash stimulus to increase the success of stopping more foreclosure by modifying loans successfully.

First of all, those who want their interest rate modified should be living in the house that is in question. It should be one’s primary, not secondary residence. If it is, for example, a house for rent or a vacation house, then it is not qualified for rate modification. Banks of course should not entertain modification if the owners have more than one property because they can just live on the other house or make money from it by renting it out.