While the banks put homeowners through many hurdles on the way to obtaining a loan modification, if one is persistent enough and has the wherewithal to make the modified loan payment, eventually loan modifications are granted. When dealing directly with the clients the lenders provide very little guidance as to how to complete the forms. Most clients want to be honest so they just give the bank all the information they have hoping that the bank will look at everything in the best light and approve them. But they just don't do that and many homeowners end up sabotaging their own applications. Recently I saw a letter received by one of my clients on a loan modification application they had submitted before they came to see me. The modification was denied for "Lack of Hardship". I read the clients' hardship letter and although it was long and well done, it did not state a hardship other than "we can't afford to make the payment". When I questioned the clients I found out that their monetary problems stemmed from a divorce and a job that gave no raises for three years, as well as an increase in the mortgage payment because the ARM adjusted. That's what the hardship letter should have addressed.
While not everyone gets a loan modification, the likelihood of eventual success is high. Most people who apply on their own are denied for lack of follow up on documentation. For the clients that we represent most denials are for too much or too little income or too much arrearage.
Persistence is the key to getting a loan modification and making sure the documents present a situation that can be approved and good record keeping when dealing with the Bank. Also, it always helps to have the fall back of a Chapter 13 that puts more pressure on the bank to deal fairly.
Facing foreclosure and in need of a loan modification or mortgage modification? At our law firm a Westchester County bankruptcy lawyer will be able to provide the experienced knowledge and guidance your case deserves. Don't hesitate to contact a member of our staff and schedule a consultation to discuss your financial situation.