Loan Modification: How To Save Your Home With A Mortgage Modification

Loan Modification

Loan modification refers to permanently altering the original loan terms to make the payment more affordable for the borrower. A loan modification is not to be confused with a refinance as the bank you pay your mortgage to does not change with a loan modification, just the terms, and conditions of your mortgage change.

If you owe more than your home is worth and have had a loan modification in the last ten years – you could be facing rising payments and, ultimately, foreclosure. For many homeowners like yourself, the grace period of low payments at low interest on mortgages purchased in the last decade is expiring, which often means big trouble for homeowners.

Mortgage Modifications

The mortgage modifications involve an extension of the payment period, reducing the interest rate on the loan and, in some instances, acquiring a different type of loan. For example, if you have an adjustable-rate mortgage, an approved loan modification will change your interest rate from an adjustable-rate to a fixed-rate mortgage.  When the cost of modifying the loan is less than the cost of foreclosing on the property, the lender will usually approve the loan modification. Foreclosure is a hard pill to swallow. The cost of foreclosure can be up to 26% of the original loan amount. The truth is, borrowers facing foreclosure due to financial hardships are also facing the prospect of homelessness. If the foreclosure cost is more than the bank’s cost of modifying your existing loan, you may be able to keep your home.

Banks can leverage this program to create a win-win solution to the progressing problem of foreclosure. Therefore, rather than evicting the borrower and getting nothing altogether, the bank allows them to keep the home while also reducing your current monthly mortgage payment. The loan repayment can also be adjusted, meaning your loan term, extending to 40 years in some cases. For example, if you have 27 years left to pay off your existing home loan and your mortgage modification application is approved, the bank may extend your mortgage loan out to 40 years. This loan term extension also gives you longer to repay the loan, making your monthly mortgage less since you have a more extended period to repay the loan.  

Fraud

What happens when borrowers get bailouts through these loan modification programs and, six months later, find themselves in the same situation, unable to pay their mortgage? This question is the basis of the mortgage modification misrepresentation, or in layman’s terms, fraud. Have you ever heard an older person say, “everything that glitters isn’t gold?” That same philosophy is true even in the world of finance. The loan modification is the glitter; however, it is not gold. It is a temporary bandage fix for a much larger problem. This systematic foreclosure by design is to lure unsuspecting borrowers to the perfect “relief package” it claims to provide.

However, if this were the case, why are over 30% of borrowers approved for a loan modification back in preforeclosure within six months of getting approved for a mortgage modification program? That is because the bank benefits from homeowners not clearing their debts but rather finding a way to make money and make money on all sides. Why do we say this? Well, did you know that Servicers make over $7,000 per loan modification application submitted? Or how about the insurance money they get to collect in the event of a borrower’s imminent default resulting in foreclosure they also collect?  Know that these are only a few ways banks benefit and capitalize off a borrower’s loss.

Here is where wrongful foreclosure and predatory lending practices and lawsuits come in, but even still, to no avail. Why? Because in non-judicial foreclosure states, such as California, the courts do not have to approve a bank to foreclose on a property. The bank does not have to substantiate their claims on why they are foreclosing.  The mortgage modification can give the borrower time to pay, but not much time. Any time a borrower falls 90 days or longer past due, the chances of that borrower being able to catch up is slim to none. Thus, not all homeowners will be bailed out and keep their homes, not even with loan modification programs. The even more harsh reality is that, according to HUD, less than 15% of borrowers who apply for a loan modification on their own get approved for a mortgage modification program. Unfortunately, the result is that over 80% of borrowers facing foreclosure will inevitably have their assets confiscated and housing in jeopardy without the reimbursement of the amount they have been paying or recovery of their down payment they invested in purchasing the property initially. 

With Wall Street putting banks on their “high horse,” so to speak, giving them the perception of being too big to fail, and bank extending fraudulent “relief packages” to borrowers through loan modifications, the system is banking on the borrower to fail. However, this is a fraud; those voices people fail to hear, just as those lawsuits are not prevailing if brought before a court unless you have thousands of dollars to fight the case in Federal Court versus state court. The odds of you winning otherwise is less than 1%. In other words, it is very slim to no chance of you recovering through legal representation or resolve. So what happens when these properties fall victim to foreclosure? The houses that get foreclosed on are just repackaged and sold back to the same investors that promised a loan modification. Not only did these investors promise loan modifications that they may have never delivered, but they are also now buying back these foreclosed properties for pennies on the dollar. What does this do for the greed of banks and Wall Street? Simple. It continues to cushion their cash flow and drastically increase their wealth, all at the borrower’s expense and theft of over nine million homeowners.

The fraud nature of the scheme is when all the benefits and promised claims fail. Not only are loan modifications failing homeowners, but banks, Wall Street, the economy, and the entire financial system is also failing homeowners. 

If you have a mortgage with adjustable rates, interest-only periods, or you got a loan modification to avoid foreclosure – this could affect you.

If you are underwater and unable to make potentially rising mortgage payments, your choices are often limited to:

• Pay higher monthly mortgage payments, which could result in as much as double.
• Try to qualify for a refinanced loan.
• Default on loan and face foreclosure
• Attempt to pay off your loan through a traditional sale with a real estate agent

If you think none of these options sound good, we agree. Understand, here at Imperium Enterprise, and we are here to help.  If selling turns out to be the best choice for you, we’ll make sure you receive a fair cash offer to buy your home as-is from us as we are a direct, cash-ready buyer. Owe more than your home is worth right now? No problem, we will immediately start working on negotiating your debt down with the bank – AT NO COST TO YOU. 

So how do homeowners navigate these uncertain times amid this systematic foreclosure epidemic? Even if your monthly payment hasn’t changed yet, rising costs may become. Sometimes, we can get up to $10,000 of bank-sponsored money back in your pocket.  Make sure you receive timely education on your options. Please call us ASAP, so we find the best solution for you together.

Imperium Enterprise specializes in helping homeowners underwater in their homes negotiate the debt down with the bank, even when it seems their options have run out. We have a network of real estate professionals, lenders. We are cash buyers who help modify, lend, or purchase homes just like yours, and in doing so, help people just like you to get out of debt permanently as a full-service relief and recovery system.

We have been able to help SO many people just like you. Please call or text message us directly today so we can work together to find the best solution for you. If the best solution for you ends up being for us to refer you to our affiliated non-profit agency to help you keep your home by modifying your existing home loan to stop foreclosure for good, that is what we will do.

Don’t Delay. Call TODAY!

(408) 684-6911