Loan Modification Companies - How do they work? Has anyone used them?

Has anyone ever used Loan Modification Companies if so how did it go? And who was the company?

I do not believe there is such a thing as a loan modification company.

Each mortgage company has an department that works on loan modifications for the loans they own and service. Therefore if you are behind on your loan and want to have the missing payments tacked on to the end, you would need to go thru your own mortgage company.

I've never heard of Loan Modification Companies either?

There are such companies that will handle everything and negotiate a better rate and everything else with your mortgage company.

what are Loan Modification Companies and how exactly do they do this, what do they charge?

With the economy the way it is now, if you need your loan modified it probably means you are behind or in financial trouble. Why waste money using an 3rd party when you can simply call your mortgage company and do it yourself?? It is not rocket science.....we had to do it a few years ago and the paperwork was very straight forward. Hubby lost his job due to the 9/11 fallout and we were behind. He finally got a new job and paperwork was fedex'd and faxed back and forth.
Took about a month but it was not a difficult process.

I DID call both of my mortgage companies and they BOTH said basically "sorry, refinance, we don't change existing loans"

I was able to get a mortgage modification on my first mortgage. I printed the forms online, filled them all out, and faxed them in. It took a few follow-up phone calls, answering some additional questions, and faxing some additional information. But they did modify the loan. They reduced the interest rate slightly and changed our payments to interest only for three years. At the end of the three years, our loan gets reamortized and the interest rate reinstated to the previous level. We are currently saving about $600 per month, but at the end of the three years, we will be paying about $100 per month more than we previously were. (I certainly hope that our financial situation improves by then!)

I also tried to get a modification on our second mortgage, and they said they couldn't do it. So I guess it depends a lot on the lender. But with the housing market the way it is right now, they lenders may be more willing to work with you because they really don't want to end up foreclosing on your house. In all likelihood, they won't be able to sell it without losing money.

well I will call them both and give them each another shot ... will let you all know what transpires!

If you're behind on your mortgage payments, you can contact your servicer directly and attempt to negotiate it yourself. In fact, they encourage it. The federally endorsed HOPE Alliance program is also available. The problem...the consumer doesn't know the rules for navigating a successful modification. Moreover, the frontline contacts have an average mortgage experience level of 2 years. Their job is to screen and push back. Their goal…provide the proverbial “NO”. CNN reported, of some 1.2 million mod attempts through the HOPE Alliance this year, about 23% were actually mods. The rest were actual repayment plans with much higher payments than the original. I’ve been doing mods since 1992. There is an art to it and most consumers can’t play the game well. Remember freshman high school football if you hadn’t put on a helmet before? Sure, you could run around trying to knock someone down and you looked like a football player…but you weren’t…really. Same thing here unfortunately. I’m a consumer advocate…questions? Call 805.340.6484. Mike

I am using one of these companies right now because WaMu did not really want to do anything. I discovered there were some things done that should not had been done, so....I am keeping my fingers crossed. What is rough right now is waiting for WaMU to respond to my modifier.

You can contact you mortgage company, but beware not all companies are equipped to handle the demand of loan modifications. Contact you mortgage, you would be surprised at what they are will to work with you on. In the tough economy and foreclosure rates going, they want to keep you in the house so that they can continue to get paid. Some mortgage companies are just the servicing agents (collection agents)for the investors

I called and they treated me like I was speaking Martian. Can anyone give me an idea of what to say other than "I am struggling to pay my mortgage and would like to request a Mortgage Loan Modification"? I have been 3-4 weeks late for the past 4 months.

Ask them if they have a loan modification department or a loss mitigation department. Other than that, I'm not sure. Mine was easy, and they had the forms right on their website.

Many times when you try to negotiate the terms of your mortgage yourself - you will not get the best reconstruction of your loan. I work for entrust (xxxxxxx) - we have a department that strictly represents you in negotiating with your lender. I learned the hard way - renegotiated to an interst only payment for a "fixed" period - which will relieve some of the pressure now but I will be back in the same position in 24 months - now with a larger balance. Wish I had used the company! Good luck!

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And what does your company charge for this service? No one who talks about the companies who offer this service (for a fee) seems to be willing to say ....