2014 MARKS THE YEAR OF LOAN MODIFICATIONS AND SHORT SALES

According to data released from  HOPE NOW, approximately 421,000 homeowners used non-foreclosure solutions from mortgage servicers in the second quarter of 2014. Non-foreclosure solutions take the form of loan modifications, short sales, deed in lieu of foreclosures and other loss mitigation options. The number of non-foreclosure solutions in 2014 Q2 was almost quadruple the number of foreclosure sales for the same period.

The most popular loan foreclosure solution is of court the loan modification, which approximately 116,000 borrowers utilized.  Short sales accounted for 33,000 and deeds in lieu of foreclosure  7,561.

Banks are more than eager to work with borrowers to workout mortgage defaults and get the borrowers back on track.  A loan modification under HAMP, the Making Homes Affordable Program, typically take between 90 to 105 days to process and obtain a trial period.  The most important factor of submitting a HAMP request is to make sure the numbers qualify the borrower for a modification.

Submitting packages blindly, without qualifying the borrower is a huge injustice to the homeowner that wants to keep their home.  There are often the modifications that take 6 to 9 months to process, since the packages may be missing financial information or the ratios under HAMP were not correct.

Another important consideration is knowing whether your loan is Fannie Mae or Freddie Mac backed, which will determine whether you are eligible for principal reduction.

Short sales on the other hand, specially under HAFA, also have strict guidelines that if the borrower is not qualified before submitting, could turn into a 9 to 12 month order with no end in sight.  Lenders quickly deny short sales where financials are missing or contracts have incorrect information.  The scope of knowledge by the preparer and negotiator is so important to determining the final decision for the lender, on whether to approve or deny a loss mitigation request.

At the Law Offices of Jacqueline A. Salcines, P.A. we never submit loan modification or short sale requests blindly. Rather, our firm has a HAMP designed program that allows us to run your numbers beforehand and advise what you qualify for.

While the lender always has the final word, you will know prior to submitting whether a mortgage modification payment is affordable.

Call us today to set up a free consult to see what non-foreclosure solution is right for you.

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