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Has anyone used a mortgage modification program?
Home values are pretty low now and thus for some re-financing is a problem. Has anyone tried a mortgage modification program where as you get a lower rate for 4-5 years without having to do a full re-finance?
voted interesting: buddawiggi M$0.10
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I have not used a mortgage modification program, but my uncle was looking into doing mortgage mods and I wouldn't suggest it. Many of the companies will promise you the moon, but they won't deliver. They just collect the fee for legal expenses and do nothing on your behalf, in fact the California State Bar (the state that I live in) has identified 16 attorneys that are under investigation for their loan modification dealings.
I would suggest calling your bank directly and try to work out a modification through them. With the housing market the way it is, and the high foreclosure rates, the last thing a bank wants is another foreclosure. They tend to be fairly helpful in lowering interest rates, sometimes forgiving debt off the loan (this isn't as common, but they do consider what the balance on your loan is versus what they would get if they foreclosed on the house). Usually the rate will slowly progress back to what it is at now, but in the short term you have a nice low interest rate to get caught up/ahead on your payment. Sometimes they do it for the full term of the loan. The only thing to be wary of is if they are extending the terms of your loan. If they lower your APR a small amount and tack 10 years more payments onto the back end of the loan it will cost you more in the long run. Just be aware that they sometimes do that!
I would suggest calling your bank directly and try to work out a modification through them. With the housing market the way it is, and the high foreclosure rates, the last thing a bank wants is another foreclosure. They tend to be fairly helpful in lowering interest rates, sometimes forgiving debt off the loan (this isn't as common, but they do consider what the balance on your loan is versus what they would get if they foreclosed on the house). Usually the rate will slowly progress back to what it is at now, but in the short term you have a nice low interest rate to get caught up/ahead on your payment. Sometimes they do it for the full term of the loan. The only thing to be wary of is if they are extending the terms of your loan. If they lower your APR a small amount and tack 10 years more payments onto the back end of the loan it will cost you more in the long run. Just be aware that they sometimes do that!
Voted as best: stanar
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