subject: Bankruptcy Attorney Ogden - Are Loan Modifications A Good Idea? [print this page] Its kind of like throwing money in the toilet and flushing it. Its really not a good thing. The loan modifications at this point, what they are doing, the vast majority arent going through. You have to be behind to qualify for the program in the first place.
The vast majority of people Im seeing in my office have been in the loan modification process, theyve sent in the paperwork three or four times, theyve gotten the reduced payment, theyve been paying it for a year they get to that point where everything is supposed to become permanent. Instead of becoming permanent, they tell them that theyre going to have to make up the rest of those payments, that they dont qualify anymore, that for some stupid reason theyre just not going to meet the criteria to do a modification.
So the end result is you go through that year or year and a half process, you get the loan modification, and youre behind. And not just a little behind, youre significantly behind.
Theyll try and lower your payment by up to maybe 70% of what the original payment was. So if youve got a $1,000 payment and you get it down to $700, youre $300 behind every single month. Well once you hit the 120 days its the same as a foreclosure it hits your credit and it hits your credit hard. Its hard to recover from something like that.
So if youre going to do the loan modification you just as well may do a Chapter 13. In reality its much easier for us to modify the debts you have that exist and reduce them as get rid of them and then take maybe a second thats unsecured and strip that off of your loan mortgage and leave you with a payment on your house that you can afford than to try and modify it. And the banks have no choice but to accept it.
I hope this has been very informational for you. I hope its helped you out. If you need information call us today or visit our website or send me an email, we do respond very quickly. If this is an emergency please call our office. Well fit you in. Well find time for you. The consultation is free so it doesnt cost you anything.
