Loan Modifications in L.A.
If you are having a hard time making your monthly mortgage payments or if your home is worth less than the balance on your mortgage, you are not alone. Thousands of hardworking homeowners in Los Angeles and throughout Southern California have mortgages they can’t afford to pay or homes that are underwater and are looking for a way to resolve their debt problems in the face of financial hardship. The good news is, there are a number of debt-relief tools homeowners in L.A. can use to lower their mortgage payments, possibly including loan modification. For any California homeowner facing financial problems and the threat of foreclosure, it is far better to be proactive and take steps to resolve the problem than to assume a “wait and see” approach, which is almost certainly going to have a negative outcome. Contact our foreclosure defense attorneys at ibankruptcyattorneys.com today to find out if a loan modification can help make your mortgage payments more manageable. We may be able to help you remain in your home and prevent you from going into foreclosure, so don’t hesitate to call.
Trusted Los Angeles Loan Modification Attorneys
There are any number of reasons homeowners may fall behind on their mortgage payments, including job loss, reduced income, divorce, illness or some other financial difficulty. And once you have defaulted on your mortgage loan, you may feel like your situation is hopeless, but all is not lost. Loan modification may be a viable solution for homeowners who have a high interest rate or a home that is underwater and are unable to make their mortgage payments, as well as those struggling with a financial hardship. Unfortunately, lenders are not always willing to agree to a loan modification, especially since they generally make more money when borrowers default on their loans and even more money when they foreclose on a property.
An experienced attorney can assist you in applying for a loan modification, submit the necessary documentation on your behalf and represent your best interests, thereby improving your chances of receiving a favorable modification and stopping foreclosure. At ibankruptcyattorneys.com, our legal team has experience handling loan modification negotiations, as well as bankruptcy proceedings and other debt-relief matters on behalf of clients. Whether you choose loan modification, bankruptcy, debt settlement or some other method of resolving your debt, a trusted foreclosure defense attorney can provide invaluable advice and legal representation and ensure that your lender shows you the respect and fair treatment you deserve.
What is a Loan Modification?
A loan modification is an adjustment in the terms of your existing mortgage loan. The main goal of loan modification is to lower your monthly mortgage payments in order to make your mortgage more manageable and help you avoid defaulting on your loan and losing your home. This is typically achieved by reducing your interest rate, extending the repayment term, or changing your loan type to a fixed-rate loan, among other options.
Who Qualifies for Loan Modification?
Not all homeowners will qualify for a Los Angeles loan modification. If you have a high interest rate but you can still afford your mortgage payments, you are not eligible for loan modification. However, if you have a high interest rate, or if your property is worth less than the balance owed on your loan, and you can’t afford your monthly payments, you may be able to renegotiate the terms of your mortgage loan. You may also qualify for loan modification if you have experienced a financial hardship that has made it difficult for you to meet your monthly mortgage obligations, such as loss of employment, job relocation, unexpected medical bills, divorce, or a death in the family. To recap, you are more likely to qualify for loan modification if:
- You have an adjustable-rate mortgage
- Your mortgage has a high interest rate
- The balance owed on your mortgage loan is more than the property is worth
- You are experiencing a financial hardship
Every loan modification case is different and there many different factors that go into a lender’s decision to approve new mortgage loan terms. The best way to find out if you qualify for a loan modification is to consult an attorney who specializes in foreclosure defense and loan modifications.
What to Expect from the Loan Modification Process
Loan modification is a debt-relief solution designed to help homeowners experiencing financial hardship keep up with their mortgage payments, avoid foreclosure and remain in their home. If you are having a hard time paying your mortgage because of a high interest rate, a decrease in property value or financial hardship, the first step in the loan modification process is to have a reputable attorney look at your current mortgage and the financial difficulties you are facing and determine whether you are a good candidate for loan modification. Reducing your payments and/or interest rate can help ease your financial difficulties, so you can continue making payments on your mortgage loan, and once you are in a position to continue paying your mortgage, the threat of foreclosure should pass.
California Homeowner Bill of Rights
In 2013, the state of California passed the California Homeowner Bill of Rights, which is a set of laws that provide important protections for California homeowners facing foreclosure. Listed below are some key provisions of the Homeowner Bill of Rights that you should be aware of, though it is a good idea to consult with a foreclosure defense lawyer to ensure that you know your rights and responsibilities regarding the loan modification process or to discuss your options for legal recourse if your lender has violated the Homeowner Bill of Rights:
- Your lender must notify you at least 30 days before beginning the foreclosure process to discuss your financial situation and review options to avoid foreclosure.
- If you request a loan modification, your lender must assign a specific person to handle your application and get you a decision.
- If you apply for a loan modification, your lender must notify you of any errors or missing information within five business days.
- You cannot be charged a fee for applying for a loan modification, nor can you be charged late fees while your lender is making a decision on your loan modification application.
- Your lender must pause the foreclosure process while making a decision on your loan modification application.
- If your lender denies your application, it must state the reasons for denial and identify any other possible options for preventing foreclosure.
- If your lender approves a loan modification and then sells or transfers your mortgage loan to another servicer, the new servicer must honor the modification.
- Your lender is obligated to review certain foreclosure documents to ensure that they are accurate and supported by reliable evidence about your loan and the lender’s right to foreclose.
Common Questions About Loan Modifications
How much can I save with a loan modification?
Possibly hundreds or even thousands of dollars each month. If your mortgage has a 30-year term and modifying the loan saves you $500 per month, you could end up saving as much as $180,000 over the life of the loan.
How long does a loan modification usually take?
Every case is different and the amount of time a loan modification will take depends on your financial situation and your lender. It generally takes about 60 to 90 days to complete, though it could take upwards of four months.
Can I modify my second mortgage?
If you have a second mortgage on your home and your first loan has already been modified, you may be able to apply for a loan modification on your second mortgage.
Loan Modification Benefits
You have worked hard and sacrificed so much to provide a home for your family, and the last thing you want to do is lose your home to foreclosure. By modifying the terms of your mortgage loan, you could avoid foreclosure and save hundreds or possibly even thousands of dollars each month, which translates to significant savings over the life of the loan. You may even be able to have a portion of that debt forgiven or wiped out. And you can keep your home, which is the most important benefit of loan modifications for borrowers. It is often in the best interest of lenders to modify mortgages for financially distressed homeowners as well, as renegotiating the terms of the loan can help transform what would otherwise be a troubled loan that the homeowner can’t afford to pay into a good loan that the homeowner can ultimately repay.
Debt Relief Through Bankruptcy
Troubled homeowners in Los Angeles who are already delinquent on their mortgage payments and facing imminent foreclosure often feel like they have no options to take control of their financial situation, but that is not the case. There are a number of debt-relief solutions that give borrowers in distress the opportunity to reduce the debts that are overwhelming them, catch up on their mortgage payments and stop foreclosure proceedings, including bankruptcy. The two most common bankruptcy filings in L.A. are Chapter 7 bankruptcy, which can eliminate all or a significant portion of your unsecured debts, and Chapter 13 bankruptcy, which you can use to repay your creditors over time, catch up on past-due mortgage payments and avoid a foreclosure.
When you file for Chapter 7 or Chapter 13 bankruptcy in Los Angeles, a court order known as the “automatic stay” immediately stops most collection actions against you, including foreclosure proceedings, harassing creditor calls, wage garnishment and debt collection lawsuits. There are a number of advantages to filing for bankruptcy when you are faced with crippling debt that you can’t afford to pay, but that doesn’t mean bankruptcy is for everyone. If you do not wish to file for bankruptcy, a knowledgeable foreclosure defense attorney can help you find an alternative solution, such as loan modification, deed in lieu of foreclosure or a short sale.
How a Loan Modification Lawyer Can Help
A successful loan modification can provide significant relief for homeowners by lowering their monthly payments, but it isn’t always easy getting a loan modification approved. The modification process can be complicated and confusing, and there is no guarantee that your application won’t be denied. If you want to dramatically improve your chances of modifying your mortgage loan and ensure that you fully understand your rights, it is in your best interest to enlist the help of a knowledgeable foreclosure attorney with extensive experience handling loan modifications in Los Angeles. At ibankruptcyattorneys.com, our foreclosure attorneys have negotiated loan modifications on behalf of homeowners in Los Angeles and throughout Southern California, and we can guide you through the process of resolving your debt problems.
When you hire our firm for your mortgage loan modification, you get a team of knowledgeable and compassionate attorneys committed to providing clients with comprehensive legal counsel on all matters related to foreclosure, loan modification and debt relief. Not only will we ensure that your loan modification paperwork is completed correctly and accurately and that your hardship is documented properly, we will also negotiate with your lender to secure mortgage loan terms that allow you to keep your home and reduce your mortgage debt. If you don’t qualify for loan modification, our attorneys will walk you through all of your other options and help you find the debt-relief solution that works best for you. Or if your modification request was unfairly denied, we can ensure that your request is properly reviewed, even if it means filing a lawsuit against the lender.
Contact iBankruptcyAttorneys.com for Your Loan Modification
Working with your lender to negotiate more favorable terms for your mortgage loan may seem daunting or even impossible, but mortgage loan modifications are obtainable, especially when you have a persistent foreclosure defense attorney standing up for you and fighting for your rights. Our skilled foreclosure attorneys at ibankruptcyattorneys.com are committed to helping homeowners in Southern California find alternatives to foreclosure, and we can assist you in applying for a mortgage loan modification in Los Angeles. We have represented thousands of clients in loan modification negotiations and bankruptcy proceedings and we can make the process go as smoothly as possible so you can focus on getting your finances back on track.