In an effort to thwart foreclosures, the Obama plan is finally making some headway in stabilizing the housing markets and preventing foreclosures in Auburn, WA.  There is so much bad/inaccurate/incorrect information out there today on this subject!

1. Credit is NOT a consideration for a Loan Modification.  The reason for this is because the borrower already qualified for credit when the home was originally purchased.

2. You do NOT have to be behind on your mortgage payments to qualify.  In fact, the lenders are getting a small bonus to work with people who are not behind on their payments.

3.  There are a lot of scammers out there trying to take your money to have them negotiate a loan modification for you.  The best bet is to use the mortgage broker you used to get your loan if you were satisfied with that person, or someone local in Auburn who is recommended.   You could pay them a small fee for their assistance for guiding you through the process.  Do NOT spend thousands of dollars for someone do negotiate with the lender on your behalf!

4.  Although “self-negotiation” can work in some instances, be advised that the lenders do NOT want to lose billions and that “self-negotiation” allows the lender to maneuver the homeowner through intimidation into more favorable conditions for them.

5.  A Home Loan Modification is achieved through negotiation with the Loan Workout/Loss Mitigation Division of the Lender to make the home more affordable for the borrower and to keep the lender from foreclosing.  By early October, more than 500,000 troubled home loans nationwide have entered into trial modification programs.  Loan modifications are now running at a faster pace than foreclosure sales.  The reason for this is that Federal officials have recently stepped up pressure to modify troubled loans after criticism during the summer that banks and other loan servicers were dragging their feet adjusting loan terms for borrowers in danger of default.

For more detailed information Home Loan Modifications is a great place to start  For recommendations and advice on loan modifications, please call me.