Loan Modification Guidelines


As you may know, President Obama’s housing plan calls for more consistent guidelines on Loan Modifications.  The details of this new plan have been released.

You can access the actual document here:


  • Borrower submits hardship claim with lender (need to contact lender for list of what that particular lender wants to see in the package).
  • Lender first reduces the monthly mortgage payment to 38% of borrower’s gross monthly income.
  • Government steps in to help further reduce the payment to 31% of gross monthly income, via dollar-for-dollar match of lender reductions between 38% and 31%.
  • Borrowers eligible for up to $1,000 per year in financial “reward” for continuing to stay current on their mortgage.
  • Lenders receive financial incentives to work with borrowers BEFORE they become delinquent.

Lenders can charge NO fees on these modifications.  BEWARE OF LOAN MODIFICATON SCAMS.  The State of Florida prohibits the collection of up-front fees for loan modifications.  Fees can only be collected once an agreement has been brokered between you and your lender.  Only a licensed attorney working on behalf of their client can charge an up-front loan modification fee.  I encourage you to work with your lender directly.  If you decide you want assistance and would like to be referred to a reputable loan modification agent, please give me a call.

I am also working on the details of the REFINANCE plan, which will enable some homeowners to refinance properties up to 105% of current appraised value.  I expect to have this information for you very soon.

Have a great week!

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