With the economy in bad shape, millions of homeowners are literally living paycheck to paycheck, and barely, if able at all, can pay their mortgage. Homeowners who are facing foreclosure should seriously consider getting a home loan modification. No matter what type of home loan situation you are in, a modification can help you save money, or your home.
A recent study by VA Home Loan Centers has found that VA loans are on the rise. In 2009, VA Home Loans represented 9.5% of every home sale; in 2010 the VA home loan financing increased to 10.77% of all home sales. Furthermore, the study indicates that by 2011 people using the VA loan option could rise to 11.5% of all homes sold. Market conditions, limited consumer resources, VA loan advantages and adjustments to bank lending regulations appear to be the reasons for this major increase. Banks took a hard look at lending procedures in 2009 and noticed that there was a crisis. People were starting to default on loans because of hard economic times. The banks suffered losses as a result of the defaults and an unraveling began which has only recently slowed.
Live in the home as your principal residence. Loan amount $729,750 or less. Loan originated before 1-1-09
Facing a financial hardship situation
Borrowers who can meet those basic guidelines may be offered a government backed loan modification that will provide a very low payment so that foreclosure can be averted. Unemployed borrowers may see their mortgage payment reduced to an affordable amount for a pre-determined time period while they attempt to find a new job or get back on track financially.
On the flip side there are some communities where the limits have fallen. Still in these communities the process to apply for the loan remains the same, and is still an option for most would be home owners. Another reason for the increase is that people are realizing that VA home loans can be used to purchase short sale homes. Short sale homes are homes that are being sold for less than the mortgage. Banks are allowing this from time to time when they stand to recoup more money versus a foreclosure.
Regardless as to whether or not your using a lawyers help, or going at it on your own, you will need to submit, documents which support hardship, and income claims. This can include things such as pay stubs, bank statements, tax returns, and other relevant information that is in your statements. After you have done this, and submitted your home loan modification application, and possibly a letter of financial hardship,wait for the mortgage lender to review your application and get back to you. Do not constantly bother them with status update phones calls or emails. Call once a week for updates.
Learn more about Obama Making Home Affordable Mortgage Program.
Source: http://explicitarticles.com/finance/loans/making-homes-affordable-program-increase-in-2011
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