1. It s All About Income

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2 1. It s All About Income Loan modification programs are based on one thing, income. The biggest misconception out there is that the bank cares about the type of hardship you have. This myth couldn t be further from the truth! All bank loan modification program guidelines are based on the relationship between what the mortgage holders income is in relation to what your regular monthly mortgage payment is. Did You Know...

3 2. The Investor Behind The Loan Is More Important Than The Servicer Most people who have been through the nightmare of trying to get approved for a loan modification are often quick to blame the servicer, and they do deserve it, believe me! However, the ultimate decision maker in whether you will receive a loan modification will be based on the program guidelines laid out by the investor of the loan. This investor could be a government sponsored entity such as Fannie Mae, Freddie Mac, FHA or VA. It could be private investor like Mellon/bank of New York or other large lenders like Wells Fargo or Bank of America. It could also be a group of investors in a privately held securitized trust, such as Morgan Stanley Loan Trust Series AR. Regardless of exactly what type of investor it is, they all will have different qualification parameters and guidelines so it s important to know what they are. You may be able to qualify for up to $10,000 in relocation assistance in a short sale. Call Tom Droscoski today for guidance.

4 3. HAMP is not the only Modification Program Available To Homeowners! HAMP (Home Affordable Modification Program) or MHA (Making Homes Affordable) is a government sponsored loan modification program that most lenders and servicers participate in. The banks will give you the impression that if you don t qualify for HAMP, then you are out of luck. Wrong! Most people do not qualify for this program. As a matter of fact, HAMP or MHA represents only about one third of the total amount of modifications approved to this date! What the banks fail to tell you is that there are dozens of in-house or traditional loan modification programs available that will evaluate your situation based on other factors. For example, some of the programs will look at your NET income, rather than Gross income and will evaluate household expenses more prominently in the equation. The banks are not keen on disclosing exactly what the specific underwriting guidelines are within these programs, but you should know that they do in fact exist.

5 4. Paperwork Is Very Important - However, it s Only 33% Of The Battle. I ve heard all of the horror stories about sending banks paperwork. The keep asking for the same things over and over, I m missing a signature on page 3 of my tax returns, they never received my last pay stub, they keep asking for a profit & loss statement from my husband, I m missing a blank page from my bank statement, etc the list goes on and on. Most homeowners send paperwork to the bank that is incomplete or outdated. They also make the huge mistake of sending small amounts separately at different times. This will guarantee that you get absolutely no where with the process! However, even if you are diligent with the paperwork you will still need specific contacts in loss mitigation to get the paperwork where it needs to go. The homeowner needs follow up at least once a week for the 60 days that the file will be in review and updated with financials. Finally, once the file gets to the underwriting department for final approval, the stated household financials need to fit one of the programs available. It s important to know what the guidelines of the programs are so you are evaluated properly and fairly.

6 5. Modifications Are Not Negotiated In Court There is a huge misconception amongst homeowners that when you appear at a foreclosure court mediation, you will have a chance to negotiate terms of a modification. This is false. In judicial states, court mediations are set up to make sure the homeowner is being given a fair opportunity and timeframe to resolve the situation by submitting the necessary paperwork through the proper bank channels. Any lawyer that tells you they can force the banks to give you a loan modification through court mediation is speaking from a lack of experience. Modifications are processed and approved in only one place, the back office of the lending institution. As a homeowner in distress, you need honest & professional guidance to help you navigate through the worrisome process of foreclosure or pre-foreclosure. Whether you are behind one payment or 2 years with your mortgage, we can help you figure out if you are a legitimate candidate for a loan modification, lowered payment, or even just a fresh start. Call Tom Now - FREE Consultation