Stratford Home Loan Modifications Lawyers

Avoid Foreclosure Through Mortgage Modification in Connecticut

A homeowner who doesn't want to file for Chapter 13 bankruptcy in order to avoid foreclosure can ask the mortgage bank to modify the mortgage to make monthly payments more manageable.

In general, if you have a steady income, a variable rate or interest-only rate mortgage, and are behind on your mortgage payments, your bank may offer you a home loan modification. If your bank does agree to modify the terms of your loan, you could be offered a 30- or even 40-year term and a lower fixed rate. This often may reduce the amount of your monthly payments.

Because of the vast numbers of people seeking home loan modifications, you may need an advocate to get through to your mortgage bank to negotiate a home loan modification.

Our law firm has served Connecticut since 1982. With offices in both Stratford and East Haven, we help our clients find reasonable solutions to personal financial crisis. Those solutions may include home loan modifications or foreclosure mediation, as well as other options. To schedule an appointment, call 203-502-7436. We offer a free consultation.

Different Options for Home Loan Modifications

Simply put, a loan modification can help homeowners avoid foreclosure by changing the financial terms of their current mortgages. Different types of home loan modifications may be available depending on your specific financial circumstances:

• Under the Home Affordable Modification Program (HAMP), also called the Obama Plan, the bank may modify your mortgage if it can decrease your monthly payments to 31 percent of your gross monthly income. To lower your monthly payments, the bank may extend the term of the loan out to 30 or 40 years or may lower the interest rate to as low as 2 percent.
• The Federal Housing Administration (FHA) has its own version of HAMP for borrowers with federal home loans. The FHA also offers a loan modification program called partial claim. In a partial claim, the arrearage — usually up to 12 months' worth — can be placed into a separate second mortgage with no payments due.
• If a borrower does not qualify for HAMP, the mortgage lender may still agree to modify the home loan. This is often called an internal modification, and the bank can roll the arrearage back into the principal, reduce the interest rate and extend the loan term.

When to Request a Home Loan Modification

The best time to start thinking about foreclosure help is before your bank begins a foreclosure action. If you are falling behind on your mortgage payments, it makes sense to contact the bank before they commence a foreclosure. However, many banks will not offer a loan modification if you are making your payments on time.

In those situations, homeowners must make the difficult decision about whether to intentionally fall behind in their mortgage payments in order to force the bank into foreclosure mediation. Ambrogio, Pletter & Associates does not recommend intentionally falling behind on your mortgage payments to induce a loan modification. If a client decides to do so, they must understand that they risk losing their home.

Contact Us to Get an Advocate on Your Side in Home Loan Modification Negotiations

To learn more about loan modifications or bankruptcy law, contact a lawyer online or call 203-502-7436. We offer a free consultation.

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