home modification loans

falling behind on a mortgage in order to pay an attorney to do a home modification loan.This would further damage our credit when we aren't behind on our mortgage yet.

Hirinig a lawyer won't damage credit. I skipped a month and my mortgage comany Huntington Mortgage modified. Not sure you need a lawyer. Call you mortgage company first.

i could be wrong but i agree with ozzie i think that they may be alot more willing had you explain to them your situation and see what they can do before getting a attorney involved. they may be more cooperative.

Being on the trial modification plan damages your credit, also reports if you get the mod that your paying partial payments as agreed which damages your credit, and that's if you get the mortgage mod. If you don't, they send you a nice bill for the difference of what you didn't have to pay during the trial period plus THOUSANDS in fees.

DON'T DO IT! Mortgage mod should be a last resort until and only after the government puts some laws or rules in writing.

I know times are tough, and would ease your burden, but you could end up worse off than what you are now... I speak from experience.

Question, I signed up to do the Mod through my mortgage bank in august and it is not settled yet... arghhhh. Will I receive fees for this also? I'm in the process of deciding what to do with my situation. Should I keep current on my cc's until this is done or should I just go ahead and start with the negotiations asap. I'm not behind YET but will be very soon.

UPDATE 1/13: Received email stating that my Citi Mortgage Mod was approved and will be receiving new closing packet in 5-7 days. There are no fees involved with the "Obama" modification through Citi Mortgage per thier rep supervisior.

I called them in August to set up a one month payment added to the end of the loan. They suggested the Mod program. I filled out all of the paperwork myself and sent in all infomation they requested. My terms are 4% for 5 years, on the 6th year it goes up to 5 for the remainder of the loan. This is a saving of over $350.00 per month.

Made initial phone call to cc's today. Praying....
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In deep

Generally there is no fee to modify your mortgage; some investors and situtations are differnt. For example if the investor of your loan does not allow all the costs added to your principal balance you may have to pay those up front. Some costs would include foreclosure attorney fees and costs, escrow shortage, late charges, or recording fees. The mod may have to be recorded. For example all mods need to be recorded in Cuyahoga County, OH and in the state of NY and the recording fee in NY is either $1100 or $1300. NY recording fee is the highest, generally in most states it is $310. You may need to record if the mod is capping over $20k or if the upb exceeds 1 million; generally a mortgage company will try to collect these if any fees in a trial period preceding the mod.

So in other words, why pay someone else for what you can do for free and why not put the money that you would pay a 3rd party towards your mortgage?

Also check with your mortgage company; on the credit reporting. The company that I work for; protects our customers credit during the trial period as long as they were current when they started the program. The credit would start reporting again after the mod or if the customer failed to keep the trial payments.

The makinghomeaffordable.gov website is a great source on any HAMP questions.

As far as the credit cards go as long as your are not trying to refiance; your mortgage company doesnt care if you are current on your credit cards. If you havent been paying on credit cards for the last 90 days, they dont count it in your expenses for a traditonal modification. They still may with the HAMP program. They would rather see you paying on your mortgage, because a credit card wont keep the rain off your head!

Is the HAMP program...the Obama loan modification program? I just do not know the official name. We are in the middle of a loan mod with Aurora Loan Services since August. No word yet. However, I did call AGAIN yesterday and was able to find out the investor guidelines were payment cannot be more than 31% of the income. I am not sure I even understand this...that seems kind of high. I was told also that we are still being reported as current on the credit reporting b/c we are making all of our trial payments. We have never been in default with them. I really wish I knew do... they run a credit report before it is all said and done and not paying on my credit cards will that hurt me? This is our first month of not paying credit cards...Loss Mititgation..you kind of answerered that above..but I just don't know what kind of loan mod I am doing..Any more insight??? I do not want to mess this up

Yes the actual name of the Obama program is the Home Affordable Modification Program HAMP or HMP. With the Obama plan your mortgage company would adjust your payment to 31% of your gross income, they can lower your interest down to 2%, extend the term of your loan and look at forbearing some of your principle balance to get you at 31%. Not everyone is approved for the program for example if your PITI (principle, interest, taxes and insurance) is already under 31% of your gross income, or if your mortgage company is not able to lower your payment enough to get you at 31%.

www.makinghomeaffordable.gov

I would reccommend going to the HAMP website, they have an eligibility section, which would tell you, if you qualify and when figuring out your gross income remember that there are 52 weeks in the year if you are paid weekly. So take your weekly gross mulitply by 52 and then divide by 12 to get your monthly gross. And 26 weeks if paid bi-weekly. (sorry everyone seems to just multiply by 2 or 4 for their monthly income)

As far as your credit cards, I would say go ahead and settle with your credit cards. They will most likely run a credit report with any mod, but your mortgage company really wouldnt care if you are paying on credit cards or not. They do look at your DTI (debt to income) when approving a mod, to determine if you can still afford a modified payment. Generally they would still count you as paying on your credit cards if you have paid within the last 90 days.