Many homeowners are investigating mortgage loan modification programs as an alternative to foreclosure and a way to stay in their homes. The Home Affordable Modification Program (HAMP) promoted by the U.S. Government aims to streamline the process but many homeowners are still unsure about where to start the loan modification process and how to give their modification application the best chance of approval. As a homeowner, preparation and knowledge will allow you to help your lender review your case thereby increasing your chances of success.
First Document Your Case
To increase your chances of success, and for the first step in the loan modification process, have your ducks in a row before contacting your lender. Your lender is going to request that you submit certain documents and forms and having them prepared in advance not only puts you one step ahead in the process but will help to speed the process along. You do not want your application sitting forgotten on someone's desk while you gather paperwork. The documents you will need as well as instructions for filling them out can be found on this web page.
Proof of your income and expenses as well as any other documentation of circumstances that are affecting your ability to pay your mortgage will help both you and your lender as you move forward. Your lender wants to make sure that any restructuring of your mortgage loan will insure your ability to pay your monthly note and this can only be achieved with a full and honest look at your current financial situation.
Second Contact Your Lender
The next step in the loan modification process is contacting your lender. Your monthly mortgage statement should provide a toll free phone number for your lender's customer service department, however, most lenders have separate departments devoted solely to modification requests. Again, in order to save time and help your lender as much as possible, refer to this table for the direct phone number and mailing address for your particular lender's loan modification or loss mitigation department. As you begin to discuss your request with a representative, you will appreciate the fact that you have prepared your documents and paperwork in advance because you will be able confidentially answer their questions on the initial phone call. Keep in mind that these representatives receive hundreds of requests a day from homeowners and most of them are not as prepared as you will be. This fact will almost assuredly make an impression on your representative as your request will be easier to process, thereby making their job easier.
Next Send Your Documents
Once you have discussed your loan modification application with your lender, submitting your supporting documents and related paperwork is next on the agenda in the loan modification process. Your lender will give you any specific instructions you will need to ensure that your application gets to the correct department, and you will want to follow their instructions to the letter. After submitting the application, and while awaiting a decision, you should continue to collect all income and expense documents so that if your lender requests more information, you will have that information at hand and also be able to immediately send any documentary proof your lender may require.
Finally, Wait and Hope
The frustrating waiting period between initial document submission and hearing back from your bank can be the most scary part of the loan modification process. That anxiety is often multiplied because banks have been known to "misplace" documents several times over; it's common for homeowners to have to resubmit their loan modification packages several times before their lender accepts it. If you're able to get past this point of the loan modification process, you will be notified by mail of your lender's decision. Remember, if at first you don't succeed, try again.
The loan modification process is not simple, and the odds are stacked against you. Proper preparation is essential for success, but you can increase your chances of approval even more by not going at this process alone. If you decide to get the assistance of a professional in this process, make sure that you hire an expert familiar with the laws and procedures for your state. Stay focused and don't get discouraged. Proper attention paid to the loan modification process can help you protect your family and your home.