An editorial in today’s New York Times sheds some light on a new mortgage modification plan that goes into effect today. Lenders are now going to have to do modifications for people who are unemployed and for people who are current on their loans. I would add the word *supposedly* because in my experience, lenders almost always need some extra prodding in the form of a letter from an attorney or even a lawsuit. Though you would hope legal action wouldn’t be necessary to get your loan modified, it may be worth it, as you will save a lot of money over the life of the loan. I do advise clients to try modification on their own first, as I’ve had some clients who’ve had good luck with it. If you go back and forth with your lender or servicer, if they lose your documents or deny you for no reason – that’s the time to get an attorney involved.
Also, use caution selecting your representative – under Texas law, ONLY an attorney can represent you in a loan modification. Anyone else offering the service (besides your own lender, of course), is not legitimate.
Click here for the editorial.
I wish I’d known this a month ago. A prospect with a GMAC loan has just done a short sale on her home because they wouldn’t do the loan mod.
Thank you for this information.