THE BIG BAILOUT! or… Loan Modification
What Do You Know About the Bail Out? Are You About to Loose Your Home??
Well like the rest of us you’re probably getting mixed messages about the Government Bail Out . After checking with several of my clients and discovering that there is a lot of incorrect information floating around I decided to check with a couple of banks.
Each bank is handling the bail out differently. So… it’s important to check with the bank that holds your mortgage.
Some banks told me that they are requiring good credit (685 fico score) a hardship letter, proof of income, and your bills can’t be more that 35% to 40% of your income. Many people that need loan modification can’t fit into these parameters
In some cases if you owe more that your home is worth the bank may reduce the amount you owe. However they are leaning more toward rate reductions and extended time periods. For example, if you have a 30 year mortgage they may extend it to 40 years and this would lower your payments.
"New Hope" Is the name given to the new "FHA Bail Out Program". It has some advantages but again it’s not going to work for everyone. Be sure to ask at your bank about how the FHA program works and if it will work for your situation.
My advice is to go to your lender and ask questions. Most of the lenders have a form you will need to fill out to get started. The faster you act the sooner you may get help. Don’t wait! The lines will form fast.