Thursday, December 22, 2011

Should I stop making home mortgage payments to get a loan modification?

Question: I keep on getting phone calls from mortgage brokers trying to convince me to stop making mortgage payments on my property in order to modify my loan at 2%. Should I actually stop making payments in order to get a loan modification?

Response: A lot of mortgage broker companies, as well as other types of real estate companies, that try to earn a living since the real estate market collapsed, will try to solicit you to get your loan modified with them. They might call or send you notices telling that you are already approved to modify your loan at 2%. Unfortunately, it is often true that banks themselves will also advise you to stop making mortgage payments in order to qualify for a loan modification. What they don't tell you is that you might not qualify. Most people do not realize that once you stop making monthly payments, a foreclosure action may be commenced after 3 months, and from that point on, a long, tedious process begins to save your home. Your unique circumstances will play a big role as to whether your loan will be modified. If you have not yet defaulted, first call your bank and see if they will even entertain an idea of working on a loan modification for you prior to default. It is always your best bet to consult with an experienced attorney and allow the attorney to negotiate with the bank on your behalf. Loan modification may save you up to 40% in your monthly mortgage payments but the process can also cause you a lot of stress and uncertainty (i.e. foreclosure). Weigh your options carefully before you voluntarily choose to default or believe someone that you are already approved for a loan modification!

In the legal blog, Attorney Svetlana Kaplun addresses typical questions our firm has received from our clients, or come across from homeowners related to foreclosure, foreclosure defense, loan modification and bankruptcy topics.

The information contained in the legal blog of Attorney Svetlana Kaplun is for informational purposes only, and should not be construed as a legal advice on any subject matter. Please read our full disclaimer or contact the Law Office of Svetlana Kaplun, P.C. by telephone at 718-444-1115 for more information.
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