How to Refinance With a Loan Modification

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      Determine your loan modification eligibility.BananaStock/BananaStock/Getty Images

      Determine if you qualify for the Home Affordable Loan Modification Program. For a homeowner to qualify, the house must be the primary residence. The mortgage must have been in place prior to January 2009. The current payment must be more than 31 percent of gross income for the mortgage holders. The total loan amount must be less than $729,750. Financial hardship for the homeowners must exist. Document this by showing past delinquent payments or a possibility of future late payments. Homeowners must provide documentation of their current gross income. The homeowners must not have felony convictions in the past 10 years, including larceny, theft, fraud forgery, money laundering or tax evasion.

    • 2). Complete the appropriate application forms. These forms include the request form, tax form and the Dodd-Frank Certification Form. These forms are available at MakingHomeAffordable.gov. See direct links to these forms in the Resource section.

    • 3). Mail the completed and signed forms to the current mortgage lender. Include proof of income with the forms, such as copies of the two most recent pay stubs. Keep copies of all submitted documents for your records.

    • 4). Read the performance report about the program at the US Department of Treasury website. (See link in Resources.) An average of 28,000 homeowners were granted permanent loan modification each month during the first six months of 2011.This program has helped more than 1.5 million homeowners with permanent loan modification or trial loan modification since its inception, reports the Treasury Department.

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