| When you apply for a loan workout, your lender will | | | | your household monthly gross income?" Most of the |
| ask you some loan modification questions to | | | | loan workout programs have guidelines based on |
| determine if you qualify for assistance. You need to | | | | your gross monthly income and what percentage of |
| know what these questions are and have your | | | | that amount goes towards your housing expenses |
| answers prepared ahead of time if you hope to have | | | | each month. Housing expenses includes principal, |
| a good chance of success. Remember, the way you | | | | interest, property taxes, homeowners insurance and |
| answer these questions will make a big difference in | | | | homeowners dues. You are allowed to use the |
| whether you get help or not. | | | | income of non-borrowers, so if you have a spouse |
| There is a basic application process that you will go | | | | who works, or you rent out a room, or your children |
| through, and part of this involves answering some | | | | contribute, you can count their income to help you |
| questions relating to your loan modification eligibility. | | | | qualify. |
| The bank will ask you for details about your income, | | | | Then you will be asked about your monthly |
| assets and monthly expenses. If you call the bank | | | | expenses, like car payments, utilities, groceries, |
| before you take the time to fine tune your figures, | | | | insurance, etc. This will help the bank determine if you |
| you are taking a shot in the dark at qualifying. It just | | | | can afford to pay and maintain the payments after |
| makes sense to take the time to figure out exactly | | | | the loan modification. There is a financial statement |
| what your bank needs to hear from you in order to | | | | that you should complete before you call your bank. |
| meet the approval guidelines. | | | | You want to have all of this information written |
| The first loan modification question will most likely be, | | | | down before you start talking to the bank. |
| "Are you facing a financial hardship situation?" This is | | | | It is critical that you know and understand the |
| the main criteria needed to qualify for a loan | | | | approval guidelines, debt ratio criteria and disposable |
| workout. If you can afford your current mortgage | | | | income requirements that your lender will use. That |
| payment but just want a lower rate because your | | | | way you can complete your loan modification forms |
| neighbor got one, you are not a good candidate. If, | | | | correctly, be able to make any adjustments to your |
| however, your income has decreased or your | | | | budget, and know that you have a good chance of |
| expenses have increased, you may be eligible. | | | | meeting all the approval guidelines your lender will be |
| The next loan modification question will be, "What is | | | | looking for. |