Default loan modification

It really varies across the board. There are no cut and dry requirements for loan modification and the "rules" keep changing, so keep your eye out for updates and continually check the news. The most widely applicable set of requirements can be cited from President Obamas federal loan modification plan:

1. Your loan was originated prior to January 1, 2009
2. Loan amount is less than $729,750.00
3. You live in the home as your primary residence
4. Your current mortgage payment equals more than 31% of your gross monthly income (for example, your gross monthly income is $2,000, and your current mortgage payment is higher than $625/month)

Hi tigerfamous,

Lenders can offer you a loan modification though your loan is not at default. If you are facing a financial crisis, write a hardship letter to your lender and request for a mortgage modification. If the lender is convinced about your financial crisis, he will offer you a modification. The modification can get combined with a forbearance plan wherein the lender can suspend your payments for few months and then depending upon your situation give you a loan modification.

Hi JChen,

Thank you very much for the information. It is really helpful. The other question is how to do it. Do I have to go to the current lender? or can I go to any other lenders?

Thanks a lot.

Hi adonis,

Thank you for the detail and the link.

If the mortgage is not current, the credit score might be impacted. Does the loan modification lower the credit score? Will the forbearance plan impact the credit score?

Thanks.

tigerfamous

Loan modification shouldnot affect your credit score

To get loan modification you want to contact yoru current lender first and also see if you can show some financial hardship for them to consider you loan modification

Good luck

Hi,
You can do loan modification ,But its rule are different for places and as per orgnisation . Also its depends upon your loan amount.
For U.S. now very attractive loan modification are in market so try to investigate that.

So contact your current lender first then he will give good advoice for changing loan modification.

Thanks
Aksh

Thank you all for different thoughts. It's really good.

Hi JChen,

Thank you for your clear instruction on how to do loan modification. It is now clear to me.

Thanks for the time.