San Diego Loan Modification

A loan modification in San Diego is a change to the original terms of your mortgage. This can include principal reductions with future shared equity, reduced interest rate, substitute an arm for a fixed rate loan, or a reduction in monthly payments with the difference added on to the principal.

There are challenge with loan modifications. It is essentially the same process and paperwork required to negotiate a short sale. This can be frustrating for a San Diego homeowner with no mortgage lending knowledge. Essentially it is a backwards loan pre-approval. Typically the lender will not approve a loan modification if your payment is being paid on time. If you stop making your mortgage payment foreclosure proceedings will begin. A loan modification is supposed to stop the foreclosure process however it isn’t a guarantee.

5% of all loan modifications ever get approved. Of this 5% over 70% default within the first 12 months. The majority of the time the reduction in monthly payment is not enough relief to make a significant difference in day to day finances. The homeowner then looks at the current market value of their home in comparison to the foreclosure across the street and the short sale selling next door, and gets further discouraged by their negative equity position. There are instances where it will take over 30 years for home owners to break even.

Finally there are many instances where the banks go back on their agreement.

Real Housewives Orange County Alexis Bellino “We have been communicating with the bank regarding loan modification options for several months. The bank has changed its offer, and the market has further declined since August, but we are continuing to work with the bank in an effort to reach a mutually agreeable resolution.”

Google “banks renege loan modification” for numerous personal testimonials

Call Today for a free no obligation consultation 760-212-2717