Understanding predatory Loan Modifications – What You Don’t Know Could Hurt You

predatory loan 01Lenders are swamped with applications from home owners that are in default and don’t have the man power to keep up with the demand from home owners that want to save their homes. The dream of home ownership seems to be withering away and is becoming more of a nightmare for home owners as their homes are losing value on a monthly basis and many have adjustable rate mortgages that spiked up and made the payments no longer affordable. Today the solution for many home owners that want to keep their homes is known as a Loan Modification. The guide to short-term lending may help you understand better about the short term lendings.

If you find yourself falling behind on payments because of an adjustable rate mortgage, reduced hours at work, divorce, illness or any other type of financial hardship, then working with a loss mitigation expert can be your saving grace. Although you can attempt to work directly with you lender to get a modification, it is highly recommended to have a professional lawyer or right business attorney  handle your case as they know exactly what the lenders are looking for and can increase your chances of actually getting approved.

If you attempt the loan modification yourself, you will find that the lender will normally try to take advantage of the home owners and not work out a mutually beneficial modification. Statistics have shown that most of home owners that attempt a loan modification without a professional, usually end up back in default within the first six months. The modification process is a very time consuming and frustrating process, as each lender has its own standards and procedures that makes it very difficult for many home owners to attempt on their own. To make matters worst, these lenders seem to change their guidelines and requirements almost on a daily basis to accommodate the ever changing real estate market. For more understanding please contact us at shawdefense.com.

Beware of companies that offer specific guarantee’s and what I mean by that is a company that tells you a specific rate and if they promise a reduction in the principal amount you owe. Principal reductions happen but very rare, normally there is a chance of see a reduction in the principal amount. And the reason it is impossible to guarantee a specific rate, is because the lender is the one that determines your rate and terms and the only way to know what you will receive is once you get an approval from the lender. Better be sure of what you are about to do.