How a Loan Modification Attorney Could Help Make Your Mortgage Affordable Again

It’s no secret that millions of homeowners around the country are struggling to keep up with their mortgage loan payments, largely due to the massive number of neighborhoods experiencing drops in property value. In fact, as of Feb. 2011, 27 percent of homes were underwater, which means millions of homeowners owe more on their mortgages than their homes are actually worth.

The government offers loan modification opportunities to help borrowers catch up on late payments, but some homeowners can’t take advantage of them because they get turned down by lenders. Could a loan modification attorney help in easing the process?

What is a Loan Modification Attorney?

A loan modification attorney is a person who is hired to help a homeowner through the loan modification process. This attorney is usually hired after a person has been turned down for a modification, but can be also be employed when a homeowner wants to modify for the first time.

If you are seeking the help of the attorney after being denied a modification by a lender, he or she will typically review your case on a legal basis, looking for flaws to leverage during negotiations. Some things the attorney consider are whether the lender has violated the Real Estate Settlement Procedures Act (RESPA) or the Truth in Lending Act (TILA).

A loan modification lawyer who is able to accomplish his goal should successfully help you do one or more of the following:

• Reduce your interest rate
• Re-amortize your loan to include past due payments
• Convert your adjustable rate mortgage to a fixed rate mortgage
• Waive the interest that may have negatively accrued
• Lower your overall mortgage payments
• Reduce the total amount that you owe on your mortgage

The government offers loan modification programs, but since they still require that you work with a lender, the attorney could help guide you through one.

Is Getting Loan Modification Help Necessary?

Now that you know the service is available, the tough question is whether you really want to get loan mod assistance. There’s no doubt this type of help could be beneficial when trying to restructure your loan, but before making the ultimate decision, it’s good to ask yourself some questions:

• Can a particular modification service really help me? The best way to answer this question is to shop around with companies and ask them how they know they can help you. Ask for the results they’ve provided to others and determine if these are the results you’re looking for. You could even ask for referrals from people who have used to service to determine just how beneficial it is.
• Can I do this on my own? After calling around or getting a free consultation, it’s good to decide whether their steps are more in-depth than those you’re capable of taking. If the service feels a lender has violated the law and wants to address legal issues, you may want the extra help. But if the service will just modify the loan, you could save your money and attempt it on your own.
• How much will this cost me? Two big questions to ask yourself are how much will the service cost and will the costs be worth the amount you’ll save down the line. Loan modification service costs can range from zero to $3,000 up front. Also, you could expect to pay 1-2 percent of your loan amount if the service is successful. So keep this in mind as you decide.

It’s good to know as you search for services that loan modification companies provide the same help as an attorney. Usually, a company has a staff of lawyers on hand to help with the negotiation process.

So have you decided whether modification services are for you? If you have reached the end of your rope and need help, there’s nothing wrong with seeking a free consultation. This could help you gather the information you need to make the best decision for you.