How Can I Prepare for the Loan Modification Process in New York State?

If you find yourself struggling to make your mortgage payments, understand that you are not alone, as many families throughout the United States are undergoing a similar struggle. Also, rest assured, you have options to get you out of this situation. Continue reading to determine whether you qualify to file for a loan modification and how an experienced Rockland County loan modification attorney at the Law Offices of Allen A. Kolber, Esq., can help you prepare for this process.

What is considered a loan modification in New York State?

Put simply, a loan modification is an option offered in New York State that has you work with your lender to adjust your existing loan. The purpose of this is to better match your existing mortgage payments with your current financial situation. With a loan modification, the back payments that you still owe will be placed back into the loan so that you can start fresh. With this, you can start making regular monthly loan payments again, and sometimes, the bank may even offer to readjust your interest rate to the current rates.

Notably, a loan modification is different than mortgage refinancing, which is when you seek a new loan altogether.

What documents do I need to prepare for the loan modification process?

Before the bank can proceed with the foreclosure and selling of your home, New York State requires that the foreclosure lawsuit be assisted to the Foreclosure Settlement Conference Part. This gives you the chance to opt for the loan modification process.

During this time, the bank will review your financial ability and determine whether you qualify for a government loan modification or their internal loan modification program. Regardless, your foreclosure action will be dismissed and you will return to your regular monthly loan payments again.

With all that being said, you must prepare the following documents for the bank to understand your financial ability and your overall eligibility for a loan modification:

  • Financial statements or profit and loss statements.
  • Personal or business bank statements.
  • Personal or business tax returns.
  • Pay stubs from each wage earner in your family.
  • Current utility bill that proves your residing in the home.
  • A hardship letter with the reason for your default and current ability to pay the mortgage.

Unfortunately, if the bank concludes that you cannot afford to pay your mortgage with your other expenses (i.e., estate taxes, insurance, utilities, etc.), they are required to take back your home as collateral and cut its losses. Nonetheless, our firm will make our best efforts to ensure that you are approved for this modification. Contact a knowledgeable Rockland County foreclosure defense attorney today.

Contact our experienced New York firm

If you require the services of an experienced Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options.