They could have gotten a real modification, but settled for whatever the lender recommended to them. They settled for what is called forbearance. Here’s how it works.
A forbearance does not reduce your payments. It doesn’t reduce your back payments, or reduces them very little. The lender just allows you to catch up on all the debt over a set time period.
You start paying your normal payments again. In addition, you also have to pay extra every month to catch up the back payments.
Many homeowners are so desperate to keep their home that they agree to this. It is the first thing recommended by their lender and they just accept it.
In most cases, the homeowner could have received a real loan modification with genuine relief. In some cases this is good for the homeowner.
They didn’t experience a big drop in income and can afford the payment. But, if their income was reduced, then they are setting themselves up for failure. Why?
Many lenders have a policy that they won’t negotiate a loan modification with someone who has already defaulted on a forbearance or loan modification.
No, they won’t admit this in public. And it usually isn’t a written policy. They just simply put people asking for a new modification on the back burner.
The bottom line: Don’t accept a forbearance unless you can afford the payments. If you do accept it and later default, then you are putting yourself at a much higher risk of losing your home.
We offer a loan modification guide to consumers. Here is what we cover in the Stop Foreclosure Institute’s Loan Modification Insider Secrets Guide.
* An easy to understand, Step By Step Guidebook.
* How to write a Hardship Letter that gets your loan modification approved.
* Three big loan modification mistakes and how to avoid them.
* Loan Modification from the lenders point of view.
* How the Making Home Affordable Program can help you.
* What not to do so you don’t risk being carted off to jail.
* How to calculate your budget properly to increase your chance of success.
To request this kit, please click here to request a copy.
I can help you short sale your property and get back on your feet. Send me an e-mail at firstname.lastname@example.org. I will contact you for a free consultation.
When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (312) 953-6725
Discover how other sellers successfully completed a short sale and request a free consultation by clicking here.
Thinking about a loan modification? Our Chicago loan modification kit has the instructions you will need to get a loan modification approved with your bank. Click here to request a copy.
Thanks for reading this, Phillip Buoscio.
Phillip is a Real Estate Agent at Better Living Realty – Buoscio Brokerage, Inc.. Chicago Short Sales Realtor:
Phone: (312) 953-6725. email@example.com.
Phil Buoscio specializes in loan modifications and short sales in Chicago Illinois. Chicago Loan Modification Help. Chicago Short Sales. Chicago Short Sale Realtor. Chicago IL Short Sales. Chicago Realtor.
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Phillip Buoscio, Better Living Realty – Buoscio Brokerage, Inc., and the Stop Foreclosure Institute are not affiliated in any way, shape, or form with the government. Our services have not been reviewed or endorse by the government or your lender. Most lenders willingly work with agents on short sales. Why?
Because most short sales are beneficial to a lender. If you accept our offer to help you on a short sale, your lender may not agree to a short sale or to modify your loan. We do offer a loan modification kit.
However, the likelihood of negotiating a modification is like everything else in life. It takes work and persistence to convince your lender to modify your loan. No matter what you or we do, your lender may not approve a loan modification.
We do not recommend that you stop paying your mortgage, because this will cause damage to your credit and could cause you to lose your home. Because we know avoiding foreclosure is so important to any homeowner, we recommend that you speak with the appropriate legal or tax advisor before making any decision.
This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing.
You have the option to reject a short sale or loan modification from your lender if it does not meet your approval. If you decide not to go thru with the short sale, then you do not have to pay us our fee. We normally make a real estate sales commission for helping you on a short sale.
The views expressed here are Phillip’s personal views and do not reflect the views of Better Living Realty – Buoscio Brokerage, Inc..
This information on Chicago Foreclosure Avoidance Help: Another Common Loan Modification Mistake and How To Avoid It is provided as a courtesy to our viewers to help them make informed decisions.