arizona loan modifications
RESIDENTIAL LOAN MODIFICATIONS
You’ve probably heard a lot about residential loan modifications lately. Probably even seen a few notorious law firms advertising on TV or been swamped with junk mail from a “modification” company. I”m getting lots of call in my office lately from people asking about loan modifications and certain claims or promises by companies. One thing is certain from what I”m hearing from consumers – BE CAREFUL! If you decide to hire a company to process your loan modification, be sure you do your homework on the company. Here are a few tips before hiring a company and paying any up front money for a loan modification:
1. Make sure you are dealing with an established company, not some start up trying to capitalize on the new get rich financial scheme.
2. Be careful about hiring any company working out of state or that does not have a physical office in your state.
3. Try to hire a company or individual that is licensed by and in good standing with your state such as licensed mortgage brokers, real estate brokers or attorneys. Note that some states require that a loan modification be processed only by certain licensed professionals.
4. Don”t pay up front fees unless you are paying the money into a neutral escrow account that you can control, or to a professional that has licensing or regulatory obligations with respect to the handling of your money (such as an attorney licensed in your state that agrees to put all or a portion of your money in the firm’s trust account subject to withdrawal only as work is completed or milestones are met). There have been many reports lately of companies taking money for modifications they promise and don’t deliver, often with no evidence of any work performed.
5. Not all borrowers are candidates for a loan modification. Make sure the company does a preliminary review of your mortgage and financial situation to confirm you are a modification candidate. Although every lender and loan type is different, there are some general guidelines that assist experienced modification processors determine the likelihood a lender will modify a loan. However, be skeptical of any “guaranty” you will get a modification. In some cases, even if you would appear a candidate on paper, the investor holding your loan or loan servicer may not approve the modification.
6. Be patient. The process can take time and require lots of follow up with your lender.
7. Don’t give up. Even if your modification request is denied, you might qualify at a later date. The rule regarding loan modifications right now is that there are no rules. With the current economic crisis, bail out money and other changing guidelines, remember the old adage “if at first you don’t succeed, try, try again”. Just because a lender denies a modification request doesn’t mean you shouldn’t try again 6 months or a year later. Conditions are changing rapidly and there is no telling what a lender may do down the road.
Marc McCain is a founding partner at McCain & Bursh, PLC, Attorneys at Law, located in Phoenix, Arizona. He can reached be reached at (602) 604-2166 or by email at mmccain@mblawaz.com with questions regarding your residential mortgage. www.mccain-bursh.com.