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Loan Modification Denied

QUESTION

I’m looking for some guidance. I live in Texas and I fell behind on my Mortgage back in November 09 due to medical issues. In January of 2010 I attempted to make two payments, which my mortgage company rejected. Once I learned of the rejection, I called hoping to set up a repayment plan. I was told that they could set up a repayment agreement but that I should apply for a modification under OBAMA’s Home Affordable Program first. Although this wasn’t my original intent, I submitted the requested forms and documents the next day, January 29, 2010 (based on their suggestion). I called back a week later just to be sure everthing was on track and requested a repayment arragement while the Mod was being reviewed. I was told that I could not be set up on a repayment plan, because my loan was being considered for Modificaiton. I called once or twice a week, with the same reponse, “no decision has been made”. Finally on March 6th I was informed after calling in that the mod was denied Back in early Feburary and that my home was now in forclousre with a April 6th sale date. I have not received anything in writing, I just learned of it during one my weekly calls, weeks after the denial. I am confused as to how it got to this point. I just wanted to set up a repayment plan. Besides paying the $10,000 plus now due to reinstate the loan, is there anything I can do?

ANSWER
A repayment plan will only be given to you after your loan is modified. The lender may reduce your interest and give you a new payment plan in order to clear off the mortgage dues. As the modification was denied, you did not receive a repayment plan from the lender. You need to contact your lender and once again reapply for the loan modification and check if the lender agrees to it.

Should I Refinance?

Should I Refinance?

Answer: YES

Should I refinance?

STEPS TO BE TAKEN CARE OF: Most banks are much stricter on their lending criteria and only those with excellent credit and equity in their homes will get access to these record low rates. Here are the some of the main considerations and hurdles you think about when refinancing your mortgage:

  • STEP1: You must have a Credit Score greater than 720
  • STEP2: Your “credit utilization” ratio, which reflects to the amount you’ve borrowed as a percentage of your available credit, accounts for 30% of your credit score. No bad credit home loans here.
  • STEP3: Must have at least 20% home equity.
    You should have at least 20% equity, based on your home’s current appraised value (not what you bought it for). If your home has dropped in value, and your loan is greater than the value of your home (i.e. you are underwater on your home) you will almost certainly be unable to refinance.
  • Home Mortgage Refinance

  • STEP4: No other mortgages or lines of credit.Should I refinance?
    If you have a home equity loan or line of credit, you’ll probably need to pay it off before refinancing, which means you need to do a cost/benefit analysis of whether refinancing makes sense for you. Before a lender will refinance your first mortgage, it typically needs approval from the lender that holds your second mortgage.

The Making Home Affordable Program is on!

Homeonwers are now starting to ask questions regarding the government’s Making Home Affordable program. This program is designed to allow eligible borrowers to refinance their high-interest mortagages for better terms. Continue reading The Making Home Affordable Program is on!

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Latest from the News

Read the news carefully today. You never know what you're gonna get. For recommended reading materials on mortgages and refinance aspects and how to fix your deeds or just plain news on real estate, check out the new york times online. It's a very good source of information.