Right now, in my office, I am receiving short sales from sellers who decided to
do a loan modification which was only valid for 3 - 5 years.
If your friend regains full employment within six months or so, the lender might be willing to
do a loan modification where all of the back payments are added to principal, but the contract starts fresh (and usually at a better interest rate).
But mortgage giants Fannie Mae and Freddie Mac aren't part of the agreement and don't plan any big changes in the way
they do loan modifications.
Leery of their promises last time I refinanced ending owing more money had to
do a loan modification to be back to square one.
The group is also looking for bank, or loan servicing insiders, whose company took federal money to
do loan modifications, and instead of doing a loan modification the bank, or loan servicer did a foreclosure.
Recently I met a seller who was attempting to
do a loan modification and was told that in order to get the loan modification they would have to come up with the amount they were in default.
If the goal is to
do a loan modification and then sell it down the road, well, you may be out of luck because you still may be underwater on the property.
Several banks have been under fire in recent months, facing accusations of «robo - signing» hundreds of foreclosure documents daily without careful review or giving borrowers an opportunity to
do a loan modification.
Other home owners will receive payments from servicers that charged unfair fees or failed to
do a loan modification.
Lots of short sale sellers tell me that they had initially tried to
do a loan modification and were rejected by their banks.
Even if you are
doing a Loan Modification and / or Short Sale, the Bank is still pushing through the Courts to get a foreclosure hearing date set.
This was all before the new law was passed that you could not take money upfront from homeowners to
do loan modifications or foreclosure rescue services.
Another exit strategy is
doing a loan modification and making the loan performing, so the UPB is important to keep in mind if you end up making the loan performing.