Waiting for your loan modification?

Published by julia | Filed under Buyer / Seller Tips, Miscellaneous, Real Estate, Shout Outs

Understandably, homeowners who apply for a loan modification tend to get a little antsy and even annoyed when they apply for a loan modification and then fail to hear anything for several weeks, especially if they continue to receive late payment notices and phone calls from collections. Many homeowners wonder how long will it be before they hear anything back regarding their loan and what they should do in the mean time.Hopefully this helps answer those questions.

The loan modification process usually takes 30 to 90 days, depending on your lender and your ability to work through the process with your attorney/loan modification representative.A professional can often reduce the amount of time required by processing your paperwork efficiently, presenting your application exactly the way the lender wants it, and knowing from past experience what the lender is willing to agree to. Although each borrower’s situation is different, knowing the lengths the lender is willing to take for similarly situated borrowers can be a time saver.

Whether you are dealing directly with your lender or through a loan modification specialist, here are a few several questions to ask up front:

• How long is the process likely to take? Find out the best- and worst-case scenarios and then count out the days and mark them on your calendar.
• When can I expect to hear something about my case? Mark this date on your calendar as well.
• If I don’t hear anything by the date given, whom should I contact? Get the person’s name, employee identification number (if available), phone number, and any extension you need to dial to reach the person directly.

What should I do while I’m waiting? Playing the waiting game can be agonizing  when you have no idea of whether your application will be accepted or rejected. Knowing the standard timeline for processing a loan modification can certainly help relieve some anxiety you may be feeling. You may also want to continue to make progress on your own by doing the following:

• If you hired a loan modification specialist to represent you, do not speak with your lender or lender’s representative. Refer all matters to the professional who is representing you. Anything you say to the lender could confuse things or compromise your representative’s ability to negotiate the best deal on your behalf.
• Log all phone calls and correspondence between you and your lender or representative. Write down the number you called, the person you talked with, what the person said, and what you said – just jot down the key points.
• Keep track of important dates. If you do not hear something back on the date promised, call the next day to find out what’s going on. If you hired a third party representative, they will (or should) keep you posted, but the lender simply doesn’t have the time to make the follow up phone calls. If you’re dealing with your lender directly, you’ll have to be the one making the calls. Consistent follow up is paramount to a successful loan modification.
•  If the lender denies your request for a loan modification or presents an offer that you cannot accept, you will need a plan B . In addition, other options may be better for you than a loan modification.
• Don’t be surprised if you continue to receive delinquency notices or late payment phone calls. Lenders rarely put a stop on the foreclosure process until a solution is fully in place. You should ask your lender if your attempts to negotiate a solution will stop or at least postpone other collection actions. If they do not, you should find out what that means for you. If the lender is able to foreclose in 30 days and a workout takes 60 days, there’s a slight timeline problem. Push to have all default and foreclosure actions put on hold while your workout attempts are in the works.

By doing your part to keep the process on track, remain informed, and explore your options, you not only improve your chances of achieving a positive outcome, but you can also reduce the stress that accompanies the waiting process.