Mortgage Modification Loan - Are You Eligible For It?

Mortgage modification is becoming increasingly common in light of today's tough economic climate. But how do you know if you are eligible for the mortgage modification loan process?

Optimism is scarce in a recession like this one. Small and large companies alike across the country are closing and their employees losing their jobs. Within the last twelve months alone, there have been 600000 more people find themselves out of work. This means that households up and down the country find themselves with massively reduced incomes and run the risk, as such, of losing their home to foreclosure as they are powerless to meet their monthly mortgage payments.

There is an option in the form of mortgage modification loan, the eligibility for which the FDIC has released a set of guidelines. However, just because you meet the FDIC criteria, does not mean that your lender has to offer you a mortgage modification. So before you approach your lender, consider these steps:

1: Do the math!

You need to write down your gross income and then you expenses, ensuring you include everything. Multiply your total gross income by 38%. Take into account every single source of income you have. And then subtract all expenses from this figure. The number you get is the amount that, according to FDIC guidelines, you can afford to pay each month in mortgage payments.

2: Assess Other Possibilities

For some mortgage lenders, the mortgage modification loan process is actually more of an option when others have been exhausted. Other options could include selling on your home for less than the remainder of the loan. This is a step for which you would require approval from your lender. You could also forfeit your deed in lieu of the outstanding mortgage, which, though is not an ideal option, will save your credit rating from any damage.

3: Get in Touch With Your Lender

Once you have made yourself aware of the possible paths you can take, your next step should be to get in touch with the lender themselves and have them talk over these viable options with you in more detail.