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anyone had experience doing loan modification with existing mortgage

Date: Fri, 04/03/2009 - 15:25
Submitted by cheek.la on Fri, 04/03/2009 - 15:25
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my first mortgage is with Citimortgage -- 6% fixed over 30 years -- I am 2 payments behind and they told me that I qualify for a loan modification if I make a payment this month. my rate would go from 6% to 3.6% and would bring my account current. I won't know any of the other terms until I actually get the paperwork. has anyone done a loan modification thru their current mortgage company? this just seems to good to be true that my rate would go down so much - my payment would go down about $140 per month. my guess is that will want to extend the term to 40 years but not sure of that yet.

thanks for any info on this.....


First of all, before you go all gung ho and start signing paperwork...

Are they offering you a permanent fix? Most lenders will offer you a temporary solution (3-6 months). If it is a permanent solution, beware of what they will do with the money that they are "saving" you. Many times the lender will put it in arrears (the backend of your loan) and this will have you paying MORE than you were before. You would be hard pressed to find a lender that will just lower your interest rate right now without having to jump through hoops. Statistically, 58% of all homeowners will re-default on their loans within 6 months. I would make sure that you know exactly what you are doing, who is primarily working on your file, what paperwork needs to be turned in, and have your original loan audited beforehand. The lender will work in their best interest. Not yours.

If you have lucked out and Citi is just making it very easy for you to get this amazing rate, Congratulations! Take it. I would make sure that is the case though. Once you have modified through the lender, it will be harder to work out a new modification if that one wasn't sufficient.

Hope this helps!


Submitted by on Mon, 04/06/2009 - 13:22

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rgovert....thanks for the info. I am not going to sign any paperwork without fully researching what I am signing - I plan to review any paperwork with an attorney before I commit to any modification. Like you said, I feel like they are going to make money out of this somehow and not really doing it for me...so I am leary that this is not a solution to MY problem, but THEIRS :) if the overall principal I owe them goes up dramatically with the modification then I will just stay behind and catch up the mortgage little by little.....thanks for the advice!


Submitted by cheek.la on Mon, 04/06/2009 - 15:33

cheek.la

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Can you update us that what happened finally. I am in a similar situation and am looking for experiences that guys like you have had. I am plannign to staart the modification process also with my lender. Good Luck to you in your case. Thanks.


Submitted by on Wed, 04/22/2009 - 17:10

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