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Need a loan modification? Try this new loan modification calculator to see if you are a good candidate and to calculate your new monthly payment. The calculator runs off of the Obama Mortgage Plan guidelines. This will cap your monthly payment at 31% of your net monthly pre tax income. There are several ways this is accomplished. The most common way is by lowering your interest rate. This can be lowered all the way down to 2% if necessary. If that does not get your payment low enough, then your terms will be extended.If you have a 30 year mortgage, your term can be extended to 40 years and thus further reduce your monthly payment. The final way to lower your monthly payment is by a principal reduction. This is not very common. The plan works in the order that I just described. So, your lender will first try lowering your interest rate and then if necessary move on to extending your terms, etc. In most cases, lowering the interest rate and/or extending the terms will bring your mortgage payment low enough to meet the 31% cap. Also, if you are way late on your mortgage payments (months and months) and you get approved for this program, your lender cannot foreclose on your for 90 days. This gives more than enough time to complete the modification and save your home. When you have the right ratios in place and call your lender, these modifications can be completed in a very short amount of time. Sometimes we see approvals with the first phone call. The whole modification can … No comments have been added to this post yet. Leave a comment |
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