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Questions To Ask Your Home Loan Modification Lender



If you have taken the first step toward a home loan modification and spoken with a banker about the possibility of modifying your mortgage agreement, you should get as much useful information as possible. Every bank handles loan modification differently, and you want to make an informed decision.

Report Back To A Lawyer

Before getting in touch with your bank about a home loan modification, however, you should consult with a loan modification attorney. Once you talk to your loan modification lender, you should meet again with your lawyer and give him the answers to the questions that you ask.

The Important Questions

  • What Are Your Solutions For Distressed Homeowners?
    • Get them to offer their wares. Most of the time, the solutions either involve temporary forbearance agreements or permanent loan modification in a variety of stripes, from simple lowering of interest rates to more complex reduction in principal, change in payment terms, or other agreements.

  • What Are Your Eligibility Requirements?
    • Every bank is different, but most banks require you to have a financial hardship but also to have good credit, as this will show them that a) you actually need a loan modification but b) you are still a trustworthy debt consumer who will pay the new mortgage.

  • How Long Does It Take To Process An Application?
    • Typically, banks will take 1-3 months to process your loan modification application. For this period, you will still be required to pay your current mortgage in full. Try to get a concrete answer so you can plan and figure out your finances ahead of time.

  • When Can I Expect To Hear Back From You? / How Can I Contact You?
    • You may need to gently remind your lender about your loan modification, as the bank will likely make it their last priority unless you stay firm about it.

  • Will You Penalize Me If I Have Difficulties Paying My Mortgage Between Now And The Loan Modification's Approval?
    • Get this one signed in writing, if possible. Some banks will advise you to stop paying your mortgage temporarily while the loan is being modified, then penalize your for late mortgage payments.

  • Will This Modification Stop Current Foreclosure Proceedings?
    • Another important one to get in writing, this question is important, as it will provide you with some peace of mind while you try to get your finances in order.

  • Do You Participate In The Federal Making Home Affordable Modification Plan?
    • If so, ask how you can get involved. Be sure to consult with your lawyer before signing up for either the federal loan modification plan or the consumer loan modification plan.

Contact your lawyer as soon as possible if you think that you need to modify your home loan. Loan modification is a difficult process, but with proper legal help, you can get through it.

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