With so many home owners unable to keep making their mortgage payments, they are desperate to find a solution and loan modification seems to be a good option. On the surface it is, with certain qualifying conditions and terms that the average home owner thinks he meets. The  reality is that the majority of loan modification companies are actually scams.

 One frequent scam occurs when a loan modification counselor tells a home owner that he or she must pay an administrative fee. A legitimate counselor would never ask for money up front for services that have not been performed. Even realistic-looking companies with web sites and contracts are suspect if the company tells you that there are unavoidable administrative fees.

Some less obvious scams are when a “short sale” facilitator tells a customer that his home is worth less than its actual value, and if you sign the deed over to him, he might then turn around and sell the house and pocket the difference.

You could be persuaded that the only way to avoid foreclosure is to give your house to the scammer and pay a lower “rent payment” to him for a specified time period and then he will sell it back to you. This is sometimes called a leaseback loan and it is also a scam. However, Even if you do find a bank or reputable lender who makes a similar deal, if the lender stops payment and defaults, you have no legal right to live there any longer.

With regard to government loan modifications, you will never have to pay any amount in advance to qualify for the loan. Scammers may try to convince you that they represent the U.S. government, but check out their credentials and see if they have been reported by any consumer complaint bureaus.

Since even the best, legitimate lenders require a lot of application forms, tax records, pay stubs and other documents, and there is fine print, unfamiliar terminology and conditions, so it pays to be very careful and take your time reading everything that the lender gives you. Hiring a loan modification attorney is sometimes the best way to protect yourself.

Millions of U.S. home owners arranged to get modified mortgage loans due to financial hardship, and now they are defaulting on their modified mortgage loans. Aren’t the loan modifications working? The answers are not simple to define or solve; more numbers and facts need to be considered before pointing any fingers. Some people say that it is inevitable that a certain number of home owners default again, since they are already in distressed financial circumstances when they get a loan modification, so it is not too surprising. But if the point of the modifications is to help solve the mortgage crisis, keep families in their homes and get the economy back on track, admittedly a herculean set of tasks, then mortgage loan modifications should be available for every home owner who needs them and they must be part of the permanent solution to the housing crisis.

The main purpose of mortgage loan modification programs is to allow the home owner to keep his or her home and refinance the mortgage to a lower monthly payment. From major national banks to the White House, programs are available to help home owners avoid foreclosure. The government has a Treasury Loan Modification Program, Chase Bank offers enhanced loan modification initiatives, Bank of America has established a home owner retention program, and several other banks are offering assistance to financially distressed home owners.

In any case, home owners who stop paying their monthly mortgage in the hope of qualifying for loan modification are taking a big risk that does not seem to be working for most of them. The best advice for a home owner who faces financial hardship is to document that hardship in a letter and gather all relevant documents to support the claim, and apply for government assistance through HAMP (Home Affordable Modification Program) as soon as possible. There are certain conditions which must be met in order to qualify but if HAMP is not the solution for you, keep applying elsewhere and keep your mortgage payments current, since that is almost always a condition of acceptance for loan modification.

Home owners seeking assistance should be sure to copy all pay stubs, letters and other documents and send every record to the lender by certified mail.

There are various options to consider if you are having trouble making your mortgage payments and are worried about foreclosure, and EMC Mortgage explores these alternative loan repayment programs, including the Making Home Affordable Program, to help people stay in their homes.

First, EMC determines the home owner’s eligibility for the home affordable modification plan, and if possible, arrange for a trial period of loan repayment. Another solution to foreclosure is called a forbearance plan, where repayments are temporarily lowered for a specific period of time so that the mortgage payment is once again current.

If a home owner does not qualify for the loan modification program, there are other loan options, but if you cannot take advantage of any of these alternatives, you might have to sell your house or arrange to transfer the title to your lender. Some home owners who have a house for sale for a long period of time but have not sold it and owe more money than the house is actually worth, might decide to do a “short sale”, basically selling the property to a mortgage broker. The amount of the short sale could be lower than the amount due. The home price is determined by current property values rather than an appraisal.

As with any major financial decision, make sure that you thoroughly investigate all of your mortgage loan modification options to be sure that you choose the best, most reputable company to assist you. Always research customers complaints as well as positive reviews of their experiences with various lenders and mortgage loan modification plans. Read the fine print so that you are not surprised by any of the repayment terms later on. For example, you would not want to find out, after signing all of the documents, that the loan is only temporary or that you are not actually approved for the loan modification plan that you want. It is a complicated issue, so be prepared with your relevant questions and concerns and have all of the paperwork filled out and documents requested when you contact EMC or any other mortgage company.

With the present mortgage crisis, banks and other lenders have suddenly found themselves in the real estate business. Banks lose thousands of dollars every time a loan default occurs. Some banks have reacted to this situation by hiring loss mitigation experts or even opening a loss mitigation department themselves. The key to a successful mitigation process lies in acting in a timely manner, since the expert needs to investigate the case and suggest solutions before a loan is defaulted on. The loss mitigator steps in when a loan payment becomes delinquent but there is still time to work out a solution. Loss mitigators can even help lower the interest rate of the loan in some cases.

The “loss” mentioned in this title refers to a bank’s assets, such as mortgage loans, and loss mitigators are typically employed by banks and other lenders to assist in minimizing losses, including foreclosures. A loss mitigation specialist will work with home owners before bankruptcy or foreclosure occur. He or she will study the case and offer ways to keep the loan viable. With the current housing crisis and defaults and foreclosures happening at an alarming rate, neither the banks nor the home owners benefit if the problem cannot be resolved.

Many home owners who lose their source of income or become seriously ill may think that it is only a matter of time until the bank comes and locks up the house, but if a loss mitigator is brought in, at least different plans can be looked into and strategies implemented that offer real hope to those in danger of losing their homes.

You can find loss mitigation specialists at many banks, and also online. In cases where the threat of foreclosure is imminent, loan repayment plans can satisfy the bank’s requirements and make the loan repayment more affordable for the home owner. It is not in the bank’s best interests to have a large number of mortgages that cannot be paid, nor is it in a home owner’s best interests to have a foreclosure or related bankruptcy on his or her credit record.

There has been an increase in mortgage restructuring due to the poor economy, job losses and other factors. One solutions is to modify an existing loan, which can solve many problems but is not always as easy as it may seem to do.

A federal program introduced in early 2009, called the Home Affordable Program (HAMP), can bring mortgage payments down to more affordable levels, not more than 38% of a person’s income. Unfortunately, only those with loans taken out before January 1, 2009, can qualify, and there are other restrictions as well. The owner must reside in the house, be able to prove financial hardship that prevents him or her from making the current mortgage payments, and must also meet some other requirements. There are several financial incentives that people who qualify for this initiative can benefit from, including reducing the principal balance. Over half a million people have been able to use the HAMP initiative, but that is a small percentage of those who are in dire need of assistance. Several major banks have also reported an increase in loan modifications in early 2011, which is good news, but problems with the system remain. The loan modification process is time-consuming and complicated. Paperwork is not submitted or is lost, people give up after a while since they see no progress, or they run out of time and default on their loan even while making every attempt to work with their lender to find a solution. The records that are required by lenders include all debts, including student loan amounts, car loan information, credit card debt, any assets and other information which is time-consuming to gather and if the paperwork is incomplete, this can prevent the loan modification process from going through.

New initiatives can help more home owners to qualify for programs that make modifying their mortgages easier, and at a lower interest rate, but much more of an effort must be made by banks and other lending institutions to show their willingness to assist home owners in keeping their homes.

New laws are being implemented now that offer increased protection for homeowners who want to modify their loans. Once you determine that you do qualify for loan modification, and all of your paperwork is in order, no lender can charge you a fee unless and until your loan is approved, which can take from several months to a year. This law frees up more homeowners to apply for loan modification, since the cost can be prohibitive and economic hardship is one of the main reasons that people are struggling to make their mortgage payments in the first place.

Your lender could offer you a temporary loan modification, but that is no guarantee that you will be approved for a permanent loan modification, which is the best way to ensure that you can keep your home and not face foreclosure.

Loan modification scams and lawsuits against lenders make the situation even more confusing, and getting an expert on foreclosures and new loan modification laws may be the best way to protect your interests. An attorney with extensive knowledge of taxes, home ownership and your rights regarding default, economic hardship and other issues, can ensure that you get the most favorable loan modification terms available.

The Home Affordable Mortgage Program (HAMP), which was established in 2008, has helped many families to avoid foreclosure, but there are millions of people struggling to make their mortgage payments, and more programs, incentives and laws need to be enacted to assist these homeowners. The time needed to wade through all of the necessary paperwork can delay loan modification approval, and HAMP seems to be helping in this regard.

Whether you decide to hire an attorney or a loan modification specialist or file your own request, keep detailed records of all financial paperwork and when records are requested, make sure to get a return receipt for any mail you send to a bank or other lending institute. Extensive documentation will be required by any lender, so have paystubs, bank records, tax returns and even a detailed list of expenses may be requested. Meticulous record-keeping is always advisable, particularly when you are fighting to retain ownership of your home.

If you hire an attorney to assist you in modifying your mortgage, you will be able to immediately stop foreclosure proceedings, and lower your interest rate and monthly payments as well. Modifying your loan can help your credit rating too. A loan modification often includes spreading your payments over a longer period of time, so the stress and fear of foreclosure or default is no longer weighing on you.

Due to the complex nature of bank laws and loan conditions, exceptions, etc., it is in the best interests of the homeowner to have an attorney submit the new loan modification proposal. You cannot be expected to be an expert in these matters. One example of added benefit to you if you have an attorney is that he or she can audit all of your current loan documents and possibly find information that reduces the amount of fees and other costs you are now paying.

For virtually all loan modification requests, homeowners are first required to write a letter detailing why they are facing hardship to the extent that they cannot continue to pay the loan back without changing the conditions of the existing loan. Your attorney will be able to ensure that all of the important points of the proof of hardship letter are covered. Since loan modification approval can hinge on the wording of this letter, it is well worth your time and money to consult with your attorney before you give the letter to the lender.

When an attorney works directly with a lender, you can be sure that no loophole, exemptions or other aspects of the contract are overlooked. It is usually less expensive for lenders to revise a loan than to allow the home loan to go into default. Also, banks do not want to have to sell homes for much less than their actual value if they can avoid it.

There are countless loan modification companies offering to help you, but there are many risks involved and some unscrupulous companies that can end up costing you money and even your house. Hiring an attorney gives the homeowner legal support, which a loan modification company cannot. An attorney can also represent you if you need to go to court.

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My mother died in April, leaving a home with a mortgage. I am her only child, and have been unable to pay her mortgage; it has gone unpaid for four months. I just received rights as Administrator of her estate, and will now be able to communicate with the mortgage company regarding the home. I do not want to lose the home or sell it now. I would like a loan modification, so I can rent it out, and sell it later when the market has improved. Do mortgage companies grant loan modifications under these circumstances?

I have been waiting for over 3 weeks for my lenders loss mitigation to get back to me and still haven’t received a call. I have been calling everyday to see if my case has been assigned to an agent. What are my options at this point?

I can’t figure out why the price of GOLD continues to go down while the Federal Reserve continues to keep interest rates at all time lows. With the Federal Reserve continuously lowering interest I do believe that inflation is right around the corner. Possibly massive inflation, the like of which has not been seen since the 1970′s.
Anyways can anyone explain?