Loan Modifications – Should You Do it Yourself Or Hire a Company?

Foreclosures are rising everyday in American, and despite the federal government's most sincere efforts, the number of mortgages in trouble or under water is steadily on the rise. Very few real foreclosure solutions exist, and those that do come at a price. One of the most popular foreclosure solutions is a mortgage modification which lowers the homeowner's monthly mortgage payment by either adjusting the interest rate on the loan or through some other option.

This option is so popular in fact that President Obama based his entire homeowner assistance program around loan definitions. The question now becomes, should a homeowner try to execute their own loan modification, or should they hire a loan modification company to do it for them? Below, you will find a breakdown of the issues surrounding the mortgage modification industry.

Cost

There's no comparison, hiring a loan modification company will cost more on the front end than if you did the loan modification yourself. The flip side of that is that homeowners may not get the desired result (a modified loan) due to a number of factors. The ability to negotiate with bank, the ability to properly fill out an application (which can extremely detailed) and the ability to follow up with the bank on a regular basis are all important to the process. So a homeowner may save money on the front end by doing the work himself or herself, but this could cost money in the long run.

Scams

There is no doubt that there are loan modification scams through the country, and doing your own mortgage modification would bypass this problem. Newspapers are filled with stories of homeowners who were taken advantage of by scammers, but there is a flip side. Most companies are not trying to scam homeowners, and many of them get results. The challenge then it looks is finding a qualified company that has referrals and a successful track record.

Timing

The modification process is a long one, sometimes taking up to a year to properly execute. Even an expert loan modification company can take months to go through all of the paper work because banks rarely cooperate. The real issue is dotting all the "I's" and crossing all the "t's" because statistics show that most homeowners who fill out their own mortgage modification applications do it improperly and have to start all over. Any application that is filled out improperly or that is incomplete will be returned, so it is not a matter of how long it takes, but how long it takes to get things right.



Source by J. Chase

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