Faqs
What Are Your Options If You Can No Longer Afford Your Mortgage? How Can I Prevent Foreclosure? What Loan Programs Are Available to You? MPowerMe has the answer to these and many more frequently asked questions.
Q. Have there been any recent changes in the foreclosure and mortgage industry that may impact homeowners like me?
Q. I‘ve heard that I must be at least 60 days delinquent on my mortgage to qualify for the Obama foreclosure help program. Is that true? Should I stop making mortgage payments even if I can still afford them?
Q. If I have bad credit, will I still qualify for loan modification?
Q. What are the bank and government programs available to me, and can I prevent foreclosure and stay in my home?
Q. What is Loan Modification?
Q. Will a lender modify any loan?
Q. How long does a Loan Modification take?
Q. What if I owe more than my home is worth?
Q. Will the government bailout help me?
Q. How do I know if I will qualify for a Loan Modification?
Q. What is a legitimate Hardship situation?
Q. Will a loan modification help me prevent foreclosure?
Q. How long do I have to act?
Q. Do federal agencies like Fannie Mae or Freddie Mac represent homeowners?
Q. Several companies have contacted me recently offering to help. What's different about you?
Q. What if my lender is already working with me?
Q. I've already talked with my lender. They just want to get paid. Can you still help me?
Q. Should I file for bankruptcy to save my house?
Q. What if I can no longer afford my home? Can you still help me?
Q. What is a Notice of Default (NOD)?
A. One important change is that the voluntary moratorium on foreclosures ended April 1, 2009. Since then many lenders are moving forward with foreclosures, which may affect you soon, if it hasn’t already. If your lender has filed a Notice of Default, you need to learn the foreclosure timeline for your state.
A. The “Obama program” formally titled the Home Affordability and Stability Program (HASP) absolutely does not require that you be 60 delinquent to qualify. You should not stop making payments if you can afford them, because doing so could negatively affect your credit.
A. Your credit rating does not affect your ability to qualify for Loan Modification. What matters the most is your ability to make mortgage payments consistently. Your income is a more important factor than your credit.
A. Each lender has its own programs and requirements. The government has the HASP Program and its requirements are specific. At our seminars, you will learn which program is best for you and learn to compile a Loan Modification package that improves your chances for approval.
A. A Loan Modification is a permanent change to one or more of the terms of the loan. The modification may result in lower monthly payments, a lower interest rate, a change in the term of the loan or a reduction in the principal balance.
A. While lenders do not have an obligation to modify your loan, most will if you can show an ability to repay the loan with the newly modified terms. Lenders are generally better off modifying a loan and avoiding the costs incurred with a foreclosure. However, this does not mean you will automatically qualify for a modification. Lenders will provide you with forms to complete but without explanation or guidance.
A. Typically, a Loan Modification will take 60-90 days, depending on the lender and your individual circumstances.
A. This is the case with many homeowners today. Fortunately, these homeowners may still be able to modify their loan.
A. In exchange for bailout monies, the federal government has ordered banks to do their part to fix the housing crisis. The Obama Program may significantly improve your chances of getting a loan modification. However, that does not guarantee you qualify. Proper submission of the loan modification package is the most crucial requirement of the Obama Program.
A. Qualification and approval for a Loan Modification depends on many factors including your monthly income and expenses and the type of hardship incurred. Your lender is looking at your ability to make the new modified payment now and in the future. You will need to supply your lender with proof of your income, a complete financial statement detailing your monthly income and expenses to demonstrate your ability to make the monthly payments. Understanding the different programs available will significantly improve your chances to qualify and successfully complete a Loan Modification.
A. All homeowners have a unique set of circumstances that caused them to fall behind on their monthly payments, but generally the lenders consider divorce or separation, a loss of income, death of a spouse, co-borrower or family member, illness, job relocation or military service to be legitimate hardships in considering a Loan Modification. A compelling hardship letter must be included in your submission package.
A. Yes, a successful Loan Modification can prevent foreclosure. In most cases, the foreclosure process is halted while you work with your lender. However, time is of the essence since the lenders have statutory timeframes for filings of Notice of Default and Notice of Trustee’s Sale. You need to take immediately action if you want to save your home, especially if your lender has already initiated foreclosure proceedings.
A. Time is of the essence if you have fallen behind on your monthly payments. We have encountered many homeowners who did not even know that they had already lost their home!
A. Fannie Mae and Freddie Mac do not represent the specific interests of the homeowner. The Mortgage Bankers Association of America indicated that 67 percent of bank initiated modifications failed within the first six months. The federal government’s own research shows that a homeowner has a much greater chance of receiving benefits with the proper education and understanding of this very difficult and confusing process.
A. Beware of unscrupulous companies who try to take advantage of you by offering to purchase your house at a discount, guarantee results or promise to lower your monthly payments or rates. Download our free report, 7 Truths about Loan Modifications, to learn more. At MPowerMe, we are dedicated to empowering homeowners through education.
A. How long has you lender been “working with you”? We hear stories every day of lenders dragging their feet until your home has been foreclosed. Banks are businesses with their financial interests at heart, not yours. They are under no obligation to consider your Loan Modification request. We will teach you which program may be best for you and increase your chances to obtain a Loan Modification.
A. Unfortunately, most homeowners get denied when they apply for a Loan Modification. Lenders know that most homeowners do not understand the Loan Modification process and prey on this lack of knowledge and vulnerability. Being denied or being asked for money does not mean you are out of options. It means you have to try again. By learning your options, you will increase your chances to successfully modify your loan.
A. According to the American Bar Association, 96% of homeowners who declare bankruptcy end up losing their home to foreclosure. Bankruptcy may delay the process but will not ultimately save your home. If you are considering bankruptcy, you should consult an attorney first.
A. If you are certain that you can no longer afford your home, there are still options such as securing a "short sale" payoff or a Deed-in Lieu of Foreclosure, but these agreements are contingent upon approval by your lender.
A. A Notice of Default is a notice sent to the borrower and filed by the lender, demanding payment for the past due mortgage payments and any applicable fees. The mortgage lender has the right to file a Notice of Default anytime after the first missed mortgage payment and is the first step in the foreclosure process. All parties to the loan and any other lien holders will typically receive a copy of the notice.