Today’s focus is about Loan Modifications. We talk about them briefly on occasion, but we don’t usually chat lots in relation to them. Fred got a phone call from some acquaintances that were just wondering what their options were in the present economic times. They are essentially spending every dollar they make every month. They are not behind on payments, but they are only keeping up. One of their associates recommended that they just walk away from the house and another friend recommended that they seek a loan modification with a principal reduction. There is a prospect that the lender would reduce the principal balance.
Fred would like to know what everyone else has experienced with loan modifications. He’s merely wondering if anybody has truly seen evidence of a successful adjustment to a principal balance. There are thousands of spectators that watch Shortsalepowerhour.com, but Kevin and Fred have still not met anybody that has done a loan loan reduction.
We can assume that there are a few good reasons that lenders do not do principal reductions on a normal basis. If the banks did this for a few property owners, everybody would be doing it. There wouldn’t be any reason for house owners to pay their current mortgage.
Yet, if the banks agree to a short sale, they get their cash right away. Then they can lend out that money once more with a new loan. The short sale is obviously the finest decision for the bank and for the property owners. As further proof from HAMP itself, the gov’t sponsored loan modification program, 25% of all HAMP modifications are at least thirty days late. The short sale is obviously the best choice for the lender and for the property owners.
Get powered up by Kevin and Fred at Short Sale Power Hour by the Short Sale Specialists of Arizona
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