If you are close to going into foreclosure or losing your home, you may feel overwhelmed by life itself. One thing you can do, however, is work with companies like Golden State Financial Group, who may be able to help you get a loan modification in place. This could, if done properly, enable you to get back on your feet.
Golden State Financial Group Explains Loan Modifications
A loan modification means that a permanent change is made to one or more of the terms and conditions of your loan, usually a mortgage. This could be the time period you have to repay it, the interest rate, whether the loan is fixed or variable, and so on. The aim is to make sure the new terms and conditions of the loan make it possible for you to make the necessary payments and eventually repay the bank. Funding has been made available by the federal government for these programs in an effort to encourage more banks to help borrowers who are otherwise facing foreclosure.
Can You Get a Modification?
Not everybody is eligible for modification. Your bank will want you to present a number of things, including:
- Proof of income.
- Complete financial statements.
- Hardship letters.
The hardship letters are particularly important and they have to explain why you have been experiencing difficulties. Your income statements should prove that you are unable to make payments as previously agreed, but that you will be able to make reduced payments. If you have no disposable income, the modification is likely to be declined.
You do not have to have defaulted before you can apply for a loan modification. You know your own financial situation and if you are in a place where you know your income has changed, or will soon be changing, and that you will not be able to continue to afford your payments, you should immediately request a modification. This will ensure that you do not default on your loan, that the foreclosure process isn’t started, and that you protect your credit rating to a degree. It will also show the bank that you are proactive in trying to find a resolution.
The process of applying for a loan modification is quite complex. Hardship letters alone, for instance, have to be written in the proper format, mentioning only the things that matter and not providing an emotional account of how you are feeling about the situation. Finding all the documents you need and using those to prove that you are experiencing hardship, while at the same time proving that you will be able to make new payments, is equally complex. This is why it is recommended to work together with a company like Golden State Financial Group, who are able to consult with you on the available options and negotiate with your lender for you.
The most important thing to remember is that you don’t have to lose your home. Get a great night’s sleep. Loan modification options are out there.