What You Need to Know About Loan Modifications

If you are unable to make mortgage payments, there is a very good chance a loan modification is exactly what you need to get your financial situation under control. Nobody wants to foreclose on their house, which is why if you find yourself behind on your payments, you must reach out to our experienced Rockland County bankruptcy attorney to learn more about how our firm can help.

How do I know if I am eligible for a loan modification?

Before you are removed from your house, foreclosure lawsuits dealing with residential properties are assigned to the Foreclosure Settlement Conference Part. In this period of time, you are generally allowed to apply for a loan modification. Loan modifications require the bank to reexamine your financial situation to determine whether you are eligible for a government loan modification program, or even the bank’s internal loan modification program. This can be a huge sigh of relief to many.

However, there are various documents you will have to provide, which is why it is always best to retain the services of an experienced bankruptcy attorney. Your attorney will ensure you supply all the information needed so that your situation can be efficiently and properly reviewed. Some of the documentation you will need can include the following:

  • Your personal or business tax records
  • Various financial statements
  • Profit and loss statements
  • Paystubs from all wage earners in your household
  • A current utility bill that can verify you are living in your home
  • A hardship letter that explains why you are not capable of paying your mortgage at the present–this letter is an extremely important part of the process, so it is crucial you hire an attorney to help draft the letter. He or she will ensure you include all the details necessary to accurately state your case.

What are the benefits of receiving a loan modification?

When you receive a government loan modification, your interest rate will be lowered to 2%, and your loan team will be extended to 40 years. This allows individuals to make lower monthly payments. Additionally, an internal banking program may lower your interest rate, fix an adjustable rate, forgive excess principal, or place your defaulted payments at the end of your loan. This means that you may not have to pay these debts until you either refinance or sell your home.

Contact our experienced Rockland County firm

Bankruptcy, for many people, is a frightening endeavor. Fortunately, with the help of an experienced attorney, it does not have to be. If you require the services of an experienced Business Law or Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options. We will have your back every step of the way.