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Questions about Loan Modification Companies

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Are you in need of a mortgage loan modification and have questions about loan modification companies? Let's take a closer look at the services these companies provide and whether or not they can really help you stay in your home.

Loan modification companies have been coming out of the woodwork since the housing crisis erupted in 2007. The role of such a company is to serve as a liaison between the borrower and the lender and aid the borrower in obtaining a new set of more comfortable loan terms on a mortgage loan. The Loan Modification company should work as an advocate for the borrower. Their service is worthwhile only if they get the consumer a better deal than they could get on their own. Historically the niche has been filled by attorneys or groups of attorneys who are highly skilled and knowledgeable in the rules and regulations surrounding loan workouts. The dangerous thing about the recent proliferation of new loan modification companies is that now you have a lot of folks jumping into this industry with no prior knowledge of the subject matter - and they are learning on your dime. Even worse, there have been countless incidents of people being scammed by loan modification companies asking for large amounts of money upfront and then either disappearing entirely or claiming to be unable to modify the loan in question.

With the rollout of the federal program aimed at helping consumers modify their loans (The Making Home Affordable program), there is now a uniform set of guidelines and expectations governing loan modifications. If your lender is participating in the Making Home Affordable program then you should be able to work with them directly to get your loan modified and bypass all 3rd party loan modification companies and attorneys. Even if your lender is not participating in the federal program you should be able to work with them directly. Start by putting together a comprehensive list of your income and expenses and make sure you have a firm grasp on what size payment you can afford - once you know this number don't settle for anything higher. When you're ready to contact your lender you will need to speak with a loss mitigation specialist (see the list of phone numbers at the bottom of this article).

If you have tried to work directly with your lender, and are getting nowhere despite your best effort, it may be necessary to enlist the help of an attorney or loan modification company. You need to proceed with the understanding that a lot of people have been scammed by loan modification companies and you will have to be extremely careful when choosing your service provider. The ideal scenario is to use an attorney or group of attorneys who have been in the loan modification industry for many years. Avoid using a firm that has been in the industry for less than 2-3 years. As stated earlier, it is largely the new entrants into this field that have been causing problems. That's not to say that all new loan modification companies are bad - it's just a much safer bet to go with a company that was in the business long before the recent housing crisis. Choosing a firm that has been around for a long time does not ensure that you won't get taken for a ride. You will need to ask for references of satisfied clients that you can contact. You should also avoid all but the most basic upfront fees. There are plenty of companies that will be content to get paid the majority of their money after your loan is successfully modified.

Another point to consider is that a skilled and reputable attorney or loan modification company may be able to get you a better deal on your loan modification than what you can get on your own. If you have tried dealing with your lender directly and are not able to come up with new loan terms that are comfortable then you should seek help. Remember, it will almost always cost your lender far less to modify your loan than it will cost to foreclose on it. It is in their best interest to keep you in your home. With home prices plummeting and homes sitting on the market for months and months - your lender is not interested in owning your home. Loan modification can be a win for both the consumer and lender in a lot of cases.

Are you ready to start the loan modification process? Here are the numbers for the loss mitigation departments that handle loan modification services for several of the nation's largest lenders:

Mortgage Company Contact Info
Ameriquest (800)-211-6926
Bank of America (800)-846-2222
Chase Mortgage (877)-838-1882 ext. 52195
Countrywide (800)-262-4218
Ditech (800)-852-0656
Fifth Third Bank (800)-375-1745 option 3
GMAC Mortgage (800)-850-4622
HSBC Mortgage (800)-338-6441
Indymac Bank (877)-736-5556
Wells Fargo (877)-216-8448