Do It Yourself Loan Modification

By Janette Coolen

Many people try to handle the mortgage loan modification process themselves. If you decide to go the DIY route with a mortgage loan modification, you have to know what things you should do, but even more importantly, what things you should NOT do! In this article, we'll go over a few mistakes that are often made in a loan modification application. Avoid these mistakes to increase your chances of getting accepted.

Mistake: Trying to negotiate with the wrong person. You may get called at home by someone from the collections department about your unpaid mortgage bills. Don't bother trying to talk with them about mortgage loan modification. These people are unable to help you and are just calling to get the money. You're better off contacting the correct department of your lender, so you can speak with someone that can actually help you out.

Mistake: Not doing proper preparation for a mortgage loan modification. If you don't take to study the mortgage modification process, save yourself the hassle of sending in the paperwork. There's an enormous chance you'll get declined, because you haven't prepared properly. Reading this article on this site is a good starting point.

Mistake: Not being completely truthful on your application form. This will get you in trouble. Many people fail to realize that a lender WILL check up on the facts provided on a mortgage loan modification application. If you get caught, you will immediately lose all chances of getting your mortgage loan modification accepted.

Mistake: Paying a big upfront fee to your mortgage loan modification company without checking their credentials. Because of the rise of foreclosures these days, there are a lot of mortgage loan modification companies rushing into the market. Some of these companies are not very qualified to handle your mortgage loan modification. You need to make sure that you're dealing with a qualified, reputable company before paying them a dime. Mortgage loan modification should get you out of financial hardship, not deeper in the hole.

Mistake: Proposing a loan workout that does not meet the approval criteria of your lender. If you do this, the lender will conclude that you have not taken the time to do your homework. As a result, your application will be denied. Always read up on the approval criteria to give yourself the greatest chance of being accepted.

Your application will look good to a lender if you don't make the mistakes we've outlined in this article. The final decision is up to the lender, but taking the time to do your mortgage loan modification right greatly increases your chances of being accepted.

About the Author:

Janette writes about financial matters and mortgages in plain English. She also writes Dutch articles about hypotheek oversluiten and rente aflossingsvrije hypotheek.