There are two basic types of loan modifications-Hamp (the government modification plan) and traditional modifications. The government HAMP program works very well once you qualify. Basically to qualify for HAMP the lender will have had to have borrowed from the government, which is most of the major banks with the exception of HSBC. There are many rules and limitations that can be seen on the Making Homes Affordable web site; however, one of the most important relates to gross income and the debt to income ratio. Income cannot be too high, or too low. Either way, the home owner can be disqualified, but again, you can always reapply. Net Present Value is also a determiner of whether or not the lender is required to offer you a Hamp modification. Net Present Value is a complicated formula involving many moving parts. Basically the NPV test examines whether the bank is better off offering a modification or foreclosing.
Traditional modifications are at the discretion of the banks and we find that about 50% of loan modifications that are offered tend to be traditional. At our Westchester County law firm we will be able to provide the legal guidance your matter needs. Our Westchester County bankruptcy lawyers have the experience necessary to assist with your claim, contact our firm and schedule a consultation to discuss your situation today.