Having to negotiate with your lender when you are in default of your loan is a tough situation. Homeowners are worried about their financial status and it can be very intimidating to try to reach some sort of deal. Even though it is very stressful, you can be successful by keeping your cool and having a plan.
Before calling and putting yourself at their mercy, have a plan in place. The first thing is to explain why you should be given a modification. Compare your property with others in the area and figure out what your property can be rented for. This is a good starting point as the lender will see what other properties currently pay monthly and can work with your individual situation. It would also give them an idea as to how much they could rent it for if they foreclosed.
Find out what your home is currently worth on the market. Your lender might require an appraisal, but you can get an idea of what your home is worth on the web. Zillow.com is one reputable site that can give you an approximation of the property's worth. Your lender will also send you an application package with other documents you need to sign and review. You will also have to provide current pay stubs and even bank statements.
Before you pick up the phone and make the initial call, have your plan ready. Review what you are going to say. Make notes on paper prior to calling to make sure you don't forget anything. Keep your cool when calling. Don't let your emotions get out of control. Getting upset will only aggravate the situation. Remember that they want to work with you, not against you. You are calling requesting help. Be polite and courteous, but be firm and confident as well.
You will probably have to explain your situation countless times to different lender employees. Make sure your story is consistent and don't change the reason why you are in your current situation. Most conversations are recorded or entered into a computer base, so the next person who reviews your records knows what happened previously. Consistency is key to getting the modification. Once you are offered a deal, compare it to what you current have. Make sure your new payment is affordable and that it will have a sufficient term so that you can re-establish your credit and start the road to financial recovery.
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