Investors Demand Changes in Obama’s Housing Plan

Several mortgage investors have urged the government to amend its $75-billion housing rescue plan. The investors, who collectively hold billions of dollars in securities backed by residential mortgages, said the legislation violates some of their rights and that they are considering legal action.

The investors have met repeatedly with Treasury officials but are still unsatisfied with the plan. According to them, certain measures in the bill prevent them from filing lawsuits against the servicers responsible for collecting payments and granting loan modification. Read more here

First Horizon Loan Modification

First Horizon Loan Modification

First Horizon is a leading financial services company operating in Texas and Tennessee. Established in 1864, it is one of the top 30 bank holding companies in the United States. Like most regional banks, its major products include sub-prime mortgages to less-than-ideal borrowers, and mortgage assistance to help these borrowers stay on track. Many First Horizon borrowers are particularly interested in loan modification. This process involves negotiating better terms with the bank to help them avoid foreclosure. A First Horizon mortgage modification also stops the foreclosure process, giving borrowers enough time to get back on track while working things out with the bank. To qualify for a First Horizon loan modification, one has to prove that he or she has a stable income and a valid reason for falling behind. The latter has to be stated in a hardship letter explaining their financial situation. Valid hardships include medical emergencies, job loss, demotion, military service, or a death in the family. Although it’s technically possible to get a loan modification on one’s own, it’s best to hire a loan modification attorney. A lawyer can ensure faster response from the bank and use lending laws to give the case more leverage. If the mortgage modification isn’t granted, they can also discuss alternatives such as a short sale, forbearance, or deed-in-lieu.

Bankruptcy Loan Modification | New Bill May Help Stop Foreclosure

Families and homeowners struggling to keep their homes may soon have the government on their side. Last year, Senator Harry Reid of Nevada introduced S.2636, commonly known as the Foreclosure Prevention Act of 2008. The bill would, among other things,  allow bankruptcy judges to modify the loans of homeowners in distress to help them avoid foreclosure.

The bill has yet to become law, but if it does, it will benefit an estimated 600,000 families. The provision has three key points: to help keep borrowers in their homes, to help distressed communities recover from the housing crisis, and to help prevent future foreclosures.

For homeowners:
S. 2636 will put $200 million into pre-foreclosure counseling, programs that help at-risk households weigh their options and make smarter decisions. The program will help around 500,000 families get in touch with their lenders and work out better mortgage terms.

Housing Finance Agencies (HFAs) will also issue bonds for refinancing, with an estimated $10 billion increase in the current cap. This will enable HFAs to refinance existing sub-prime loans using funds from mortgage revenue bonds, originate new mortgages for first-time buyers, and provide multi-family rentals. Increased lending will then create new jobs and generate revenue in the local, state, and federal levels.

The bill will also change the Bankruptcy Code so that judges will be allowed to modify mortgages. This will help families get loan modifications even in bankruptcy, which normally prevents them from getting modification offers.

For communities and business:
The bill will put $4 billion into the Community Development Block Grant (CDBG) to buy and rehabilitate foreclosed homes. Foreclosed properties usually sit unoccupied in the market, reducing the value of other homes in the neighborhood. With S. 2636, communities with the highest foreclosure rates can use CDBG funding to buy these homes and put them back on the market.

Businesses can also benefit from this stimulus package by filing net operating losses (NOLs) in previous years in their tax returns, making them eligible for refunds. NOLs from way back in 2001 can be carried over to the company’s 2006 and 2007 losses, increasing the current limit from two years to five. refunds. For 2006 and 2007 losses, the

Preventive measures:
Finally, S. 2636 will simplify the disclosure requirements on mortgage paperwork. The Truth in Lending Act (TILA), which has long dictated transparency measures in mortgage lending, will be extended to refinancing documents as well. Lenders will now have to disclose the mortgage terms and the maximum payment within three days after the application and no later than seven days before the deal is closed. Violators will be subject to the same penalties as the TILA provisions, with the damages for mortgage-related violations ranging from $2,000 to $5,000.

Lenders are naturally opposed to this bill, and the Senate has yet to vote on it in the next Congress session. Meanwhile, at-risk homeowners can get assistance from attorney-backed loan modification firms who can help them find better loan modification deals.

Loan Modification Questions and Answers

Loan Modification – 5 Things to Consider Before Applying

Choosing a loan modification isn’t a decision you make overnight. Sure, it can be your ticket to a better mortgage, but it’s not a surefire way to solve your money problems. Like any other transaction, it has its challenges, and it suits some people better than others. If you’re not the right candidate, even the best loan modification attorney can’t guarantee the results you want.

Remember, loan modification is as much a commitment as it is a solution. If you’re considering a loan modification, here are some things you should ask yourself before making any decisions.

1. Do I qualify?
Each lender has its own policies, but the general requirement is that you have a job and be able to prove your financial hardship. This tells your lender two things: first, that falling behind wasn’t entirely your fault, and second, that modifying your loan can really help you back on your feet. If you’re still unstable or have no reason to request mortgage assistance, your loan modification firm won’t be able to help much.

2. How far behind am I?
It’s important to build a strong case to persuade your lender, but there are limits to how far behind you can be. It’s one thing to miss a few payments because you lost your job, but it’s another to deliberately miss half a year because of bad spending habits. As your debt accumulates, your lender perceives you as a high-risk borrower and may be less willing to work with you.

3. Can I afford it?
Depending on your situation, a loan modification can cost you anywhere from $2,000 to $5,000. But it’s not just a matter of having that much money in the bank. If you’re in a really tight fix and it’s the last of your funds, you may want to wait a bit so you’re not left with nothing in case your bank rejects your application. Your loan modification attorney can help you figure out a budget so you can plan it out better.

4. How much equity do I have?
Your equity value is probably the biggest factor affecting your lender’s decision. If you have enough equity to cover foreclosure expenses and deferred interest, foreclosure may actually be cheaper for your bank. However, equity is determined by the value of your property, which your lender can easily overestimate. Do some research beforehand to see how much your home is really worth, so you can face your lender with hard facts.

5. Can I stay on track?
A loan modification won’t free you of all responsibilities; it only allows you to meet them more comfortably. Once it’s granted, it’s no longer your attorney’s job to keep you on track. Make sure you have enough money saved up to cover initial payments when the mortgage reinstates, as well as an emergency fund. If something comes up and you fall behind again, the whole loan modification process will have been useless.

The Do’s and Dont’s about Loan Modification you Must Know

One of the biggest mistakes you can make in a loan modification is to ignore the rules. Although your Loan Modification Firm does the negotiating, it helps a great deal if you do your homework and arm yourself with the right information. After all, you’re dealing with lenders—and at the end of the day, you still have to play by their rules. Here’s a list of loan modification do’s and don’ts to help you avoid common pitfalls.

Do know your rights.

More than 80% of mortgage contracts violate one or more lending laws—and most of them go unnoticed. But these violations can be your biggest weapon in the loan modification process. They can give you the leverage you need to negotiate with your lender and stop foreclosure. Your loan modification attorney can help you understand your rights and use them to get the results you want.

Don’t wait too long.

The foreclosure process is designed so that you have time to get back on your feet and save your home. But that doesn’t mean it’s safe to procrastinate. The longer you wait, the harder it gets to get you out of that fix. As soon as you decide you need mortgage help, call a loan modification attorney and get started.

Do work with your lawyer.

Your loan modification doesn’t rest in the hands of your lender, your broker, or your loan modification attorney. These people can help, but you have to do your part and cooperate with your lawyer. Make sure to submit your paperwork on time, answer questions honestly, and give them a clear picture of your financial situation.

Don’t file for bankruptcy, unless you really have to.

Many people think that filing for bankruptcy can help them stop foreclosure. But data from the American Bar Association shows that it doesn’t work that way. In fact, 96% of the people who file bankruptcy end up losing their homes anyway—so they’re left with a foreclosure AND a bankruptcy on their records. In some cases, bankruptcy is still a viable option, but don’t make any decisions without getting professional advice.

Do have a backup plan.

Not all people will qualify for a loan modification. Maybe you’ve fallen too far behind, your lender may be simply hard to work with, or maybe you don’t need it after all. In any case, it’s always good to have a Plan B. Your mortgage modification attorney can help you find the best solution.

If you can’t get your loan modified, talk to your lawyer about a short sale. This involves selling your home for less than its fair market value and giving the proceeds to your lender. Although you still lose your home, it’s not as damaging to your credit as foreclosure, so it’s easier to get back on your feet.

Modify home Loan or Mortgage rate to Avoid Foreclosure in this recessionary market

Choosing a loan modification isn’t a decision you make overnight. Sure, it can be your ticket to a better mortgage, but it’s not a surefire way to solve your money problems. Like any other transaction, it has its challenges, and it suits some people better than others. If you’re not the right candidate, even the best loan modification attorney can’t guarantee the results you want.

Remember, loan modification is as much a commitment as it is a solution. If you’re considering modify home loan, here are some things you should ask yourself before making any decisions.

Do I qualify?

Each lender has its own policies, but the general requirement is that you have a job and be able to prove your financial hardship. This tells your lender two things: first, that falling behind wasn’t entirely your fault, and second, that modifying your loan can really help you back on your feet. If you’re still unstable or have no reason to request mortgage assistance, your loan modification firm won’t be able to help much.

How far behind am I?

It’s important to build a strong case to persuade your lender, but there are limits to how far behind you can be. It’s one thing to miss a few payments because you lost your job, but it’s another to deliberately miss half a year because of bad spending habits. As your debt accumulates, your lender perceives you as a high-risk borrower and may be less willing to work with you.

Can I afford it?

Depending on your situation, a loan modification can cost you anywhere from $2,000 to $5,000. But it’s not just a matter of having that much money in the bank. If you’re in a really tight fix and it’s the last of your funds, you may want to wait a bit so you’re not left with nothing in case your bank rejects your application. Your loan modification attorney can help you figure out a budget so you can plan it out better.

How much equity do I have?

Your equity value is probably the biggest factor affecting your lender’s decision. If you have enough equity to cover foreclosure expenses and deferred interest, foreclosure may actually be cheaper for your bank. However, equity is determined by the value of your property, which your lender can easily overestimate. Do some research beforehand to see how much your home is really worth, so you can face your lender with hard facts.

Can I stay on track?

A loan modification won’t free you of all responsibilities; it only allows you to meet them more comfortably. Once it’s granted, it’s no longer your attorney’s job to keep you on track. Make sure you have enough money saved up to cover initial payments when the mortgage reinstates, as well as an emergency fund. If something comes up and you fall behind again, the whole loan modification process will have been useless.

To get in touch with a good loan modification attorney you may call 800.738.1170 or visit http://www.cdloanmod.com