Tips on the loan modification process

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What does it take to keep a loan modification on track? Patience, of course – the process can easily take up to 90 days. But according to an article at Realty Times, careful note-taking, a calendar to mark, and a willingness to use the telephone again and again are your best friends in working through the process.

The article by real estate agent and speaker Ralph R. Roberts (http://realtytimes.com/rtpages/20090413_loantake.htm) advises borrowers to ask several questions upfront, whether they are dealing directly with a lender or working through a loan modification specialist.

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.

If I don’t hear anything by the specified date, 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.

Don’t expect lenders to call you back to keep you current on your situation, because they won’t, Roberts says. If a deadline to hear something passes, get on the phone yourself, the next day, and ask why. And develop backup Plan B, and maybe Plan C and Plan D, he says.

In addition, other options may be better for you than a loan modification. Consult a real estate agent about listing your home for sale. Talk to a mortgage broker or loan officer about refinancing. Speak with a bankruptcy attorney to find out whether filing bankruptcy would be a better choice.

Finally, Roberts advises, don’t be surprised if delinquency notices or late-payment phone calls continue. You should push to have all default and foreclosure actions frozen while you are trying to restructure the loan, he says, but adds: “Lenders rarely put a stop on the foreclosure process until a workout solution is fully in place.”

-- E. Scott Reckard