Loan modifications are not an easy task. There are many steps to this process and unfortunately it's very time consuming. This is particularly the case when homeowners don't hear anything for weeks at a time, especially if they are still receiving late payment notices and difficult phone calls from collection agencies. Many homeowners who are interested in doing a loan modification really don't know how long this process will take before they hear anything and wonder if there's anything they should while waiting. Here are some tips to help your clients with answers these questions.
The loan modification process can take anywhere from 30 to 90 days, which is mostly dependant on two things; their lender and their ability to work through the process with a loan modification representative or an attorney.
There's no set time-span on a loan modification. Unfortunately, the more complicated their situation is the longer the process takes. When a borrower is dealing with a lot of collateral issues then the loan modification process can take longer than the typical 30 to 90 days.
Working with a professional can help reduce the amount of time by processing the paperwork efficiently and returning the application exactly how the lender wants it. Every borrower's situation is different and unique, and understanding the measures the lender will try and take for similar borrowers can be a real time saver.
There are several questions that need to be asked initially whether they are dealing directly with the lender or with a loan modification specialist:
How long will this process take? Find out what could be the earliest or the latest they might get through the process and then put those dates on their calendar.
How soon until they hear something about their case? When they are told an approximate date then they should put it on their calendar.
Who should they contact if they don't hear anything by a specified date? They should write down the person's name, their phone number with extension so they can call them directly.
Once the process is in motion what can they do while waiting for news on their loan? This is where having an idea on the time it might take to process the new loan will help. However, there are several things they can do to help the process:
If they are working with a loan modification specialist, then let them work with their lender directly. If they contact the lender directly it may delay the process.
They should keep a detailed record of all phone calls and correspondence between them, their lender and/or loan modification specialist. They should write down who they spoke with, their number and what was said. They don't have to write down everything verbatim, but rather key points and/or phrases.
They should follow all important dates. If they were told they would hear something by a particular date and they haven't then they should call the following day. However, tell your client that the lender will most likely be working on many different loans at the same time; so if they are working with a loan modification specialist then they should have them do the calling for them. Also, they should continue to keep track of all promised dates and times and be consistent with their follow-through because doing so will help make their modification more successful.
They should consider other options. They must be prepared for a denial or an offer that is unacceptable. Therefore they should have other options at hand. Keep in mind that the other options may be a better solution than a loan modification. Work with your clients about listing their home for sale or have them talk to a mortgage broker about refinancing. One final option could be speaking to a bankruptcy attorney figure out if it would be to their benefit to file for bankruptcy.
There's a good chance that your client will continue to get delinquency notices and collection agency phone calls. Unfortunately most lenders won't stop the foreclosure process until a solution has been worked out. Your clients should ask their lender to have the foreclosure process put on hold until they can workout a possible solution.
When your client's future is in someone else's hands, the 30 to 90 days that it may take for a loan modification can seem to take forever. But by keeping up their diligence tracking the process, staying informed, and looking into other alternatives, they not only can improve their chances of having a positive result, but they can help reduce the stress that comes while waiting for their loan modification to be determined.
This article is for informational purposes only. Individuals should consult with qualified professionals on each individual's particular situation. This article should not be construed as legal advice.