One way to save your home from foreclosure is through mortgage modification. A mortgage modification is any change to your original promissory note and mortgage. If you qualify, a mortgage modification will enable you to retain ownership of your home, and reduce the monthly mortgage payment. Mortgage modification is available before foreclosure, during foreclosure, and even in the context of a bankruptcy case.
You will be required to submit a hardship letter to the mortgage lender. In the letter you must explain why you defaulted on the mortgage. Some reasons include job loss, illness, and divorce. You must then explain what has changed that will enable you to resume mortgage payments. This may include a new job, the second spouse finding employment, family help, etc.
The monthly payment is usually reduced through a combination of a reduction in the interest rate, extension of the loan term, and reduction of the principal balance. While most lenders are very reluctant to reduce principal, some are willing to defer payment of a portion of the principal until you either sell or refinance.
Mortgage modification is a complicated and paper intensive process. You are required to complete applications, and submit financial statements, bank account records, tax returns, paystubs, affidavits, etc.
We are experienced with mortgage modifications and would like to help you. Please contact us to discuss mortgage modification and whether it is an option for you.