With the government’s new Home Affordability Mortgage Modification Plan, many Americans will be able to save their home from foreclosure.  In the past, the modifications have not been working very well, but there is hope that with the new guidelines established under the plan, they will help homeowners with affordable mortgage payments that they can keep making every month.

Q: How Do I Apply for a Loan Modification?
A: Working with a mortgage loan modification company or consulting with your attorney will facilitate your application process.  Since mortgage modification companies are experts in negotiating mortgage modifications with lenders and have established relationships with them, they are able to achieve better results for their clients.   The mortgage modification company will help you gather the required information to make sure your application gets reviewed and approved.

While you can try and apply for a modification on your own, why take the risk that you may forget to include something or answer a question incorrectly jeopardizing your chances of getting a modification that you so need.

For a small fee, your loan modification company will be able to achieve the success and results you deserve –saving your home from foreclosure.

Q: Who Qualifies for a Mortgage Modification?
A: Under the new plan, you must be an owner occupant.  Owner occupied 2-4 unit properties qualify as well. Investment properties, vacant and condemned properties do not qualify.

Q: How Long Does it Take to Get a Mortgage Modification?
A: The process can take awhile anywhere from 90 days or longer. With the new streamlined guidelines, the process is expected to move along quicker than in the past.

Q: How Much Lower Will My Interest Rate Be?
A:  The guidelines allow the interest rate to be reduced no more than 2 points.  Mortgage modifications work best on variable interest rate loans.  You will want to have your variable mortgage switched to a fixed rate mortgage.

Q: How Many Times Can I Receive a Mortgage Modification?
A: Under the new plan, borrowers may only modify their mortgage once.

Q: When Does the Modification Take Effect?
A: Your modification will take effect immediately once your lender has approved the paperwork.

Q: What if I Lost My Job, Will I Still Qualify?
A: If you do not have sufficient income to pay the new mortgage payment, you will not qualify for a mortgage modification.

Q: What Other Options Do I Have?
A: Besides obtaining a mortgage modification, you may qualify for refinancing or your lender may agree to forgive some of your mortgage debt.  Other options are selling your home in a short sale, selling if your home if you have equity or signing a deed in lieu of foreclosure returning the home to the lender and walking away from the mortgage. Bankruptcy is a last resort if you have no other options to save your home from foreclosure.  Consult with your tax adviser or attorney to determine the best option for your financial situation.

As always, thanks for reading this post and if you enjoyed it be sure to comment below. Also, check out our FREE 2009 Loan Modification Guide: Saving Your Home From Foreclosure.