Loan Modification Program - No Longer A Secret!
You may have never heard about a loan modification program prior to this year; banks didn't actually publicize the option
. If you became delinquent in your mortgage, you just usually either dug yourself out with the help of a wealthy relative or waited until you were tossed out of your home through foreclosure. The bank really did not make much of an overture to help you save your home.The 2009 Stimulus Bill brought the Making Home Affordable Program into existence. This is basically a bail-out for the average homeowner, sandwiched in with bail-outs for several other segments of the economy: banks, automakers, etc...
Obama's loan modifications included an incentive to be paid to participating banks to encourage them to rework loans for desperate homeowners who qualify for the program. The program is scheduled to end in December, 2012. $75 billion dollars in funding has been allocated to this particular program, and it is predicted that millions of homeowners will be assisted.
Lenders have never been happy to do a foreclosure on a home, but they rarely offered to do a loan modification unless they were actually cutting their losses on a major scale. It is expensive to them in more than one way. It usually involves some idle time when the property is not producing any income. There is money involved in the procedures of foreclosure and putting the home on the market. There is also a tremendous labor cost to the bank in handling the foreclosure. And, the worsening real estate market has made foreclosure even more distasteful to lenders.
So, if you are facing foreclosure, you should certainly be aware of what a loan modification program could do for you. The secret is out!
by: Cassandra Sessions