Mortgage Loan Modifications Pick up Steam

[Oct 9, 2009.]

 

After months of complaints about the the Obama administration's mortgage loan modification plan, it looks like more troubled homeowners are seeing some results. Treasury Secretary Timothy F. Geithner said this week that 500,000 homeowners have had their mortgage loans modified under the rescue plan. Here's what homeowners need to know about the program if they are still trying to get help from their mortgage company.

Squeaky Wheel Gets the Oil

Borrowers who need help modifying their mortgages must to be aggressive about contacting their mortgage company. They should call their mortgage company even if they haven't had success getting through previously.

Many mortgage lenders have increased the number of staff devoted to helping borrowers with mortgage refinancing and loan modifications. Furthermore, some mortgage lenders are trying to work with homeowners experiencing true financial hardship even if they don't qualify for help under the government's plan.

Provide All Documents Requested

Borrowers who've actually made contact with the right representative at their mortgage lender need to be diligent about providing all paperwork that is requested. Documents they might need to provide include proof of unemployment, pay stubs, tax returns, and financial hardship letters. Not delivering requested information in a timely fashion can delay a loan modification or mortgage refinancing.

Continue Searching for Other Solutions

Homeowners who've grown weary of finding ways to keep their home out of foreclosure should continue to seek solutions to their dilemma. If a mortgage loan modification or mortgage refinancing is going no where, perhaps a homeowner can find a buyer to agree to a short sale. A short sale takes place when a mortgage lender allows a homeower to sell his property for less than what is owed on a mortgage. Like mortgage modifications, short sales take time and require a lot of follow up and record-keeping on the part of the borrower.

Mortgage Payments and Renters

Homeowners who can't find a buyer and feel they are in limbo waiting to hear back from their mortgage company can also consider taking in a border to pay rent, which can be applied to the monthly payments on the mortgage. While this may not be the best-case scenario, it's likely that many troubled homeowners already know a friend or family member who needs a place to stay and can help out with the monthly payments on the mortage.

 

About Author:

Francine L. Huff is a freelance journalist and the author of The 25-Day Money Makeover for Women. She has appeared on a variety of TV and radio shows.