Things You Need To Know for Qualifying Loan Modification

Typically, to qualify for a federal loan modification program, most mortgage modification lenders require borrowers to satisfy the debt ratio guidelines and submit details of financial hardships faced along with the proof of income expressing ability to pay monthly installments.

Millions of distressed homeowners in America are in ardent need of a mortgage loan modification to stay in their houses. Besides, modifying your existing upside down home mortgages is one of the most cost-effective ways to overcome your financial hardships. While there are plenty of options available to modify your mortgages, it could not be that easy for everybody to qualify for a loan modification since each lender has devised separate guidelines for determining the eligibility requirements for mortgage modification assistance. And house makers are thereby required to furnish certain documents along with the application which are in accordance with those guidelines to get approved from a suitable mortgage loan lender. Typically, most mortgage modification lenders require borrowers to satisfy the debt ratio guidelines and submit details of financial hardships faced along with the proof of income expressing ability to pay monthly installments.

Guidelines for debt ratio

Under the federal stimulus modification plan, a debt ratio of 31% is desired for the new modified mortgage loan payment. Thereby to enhance your chances of getting approved you need to calculate the ratio prior to making an application. This could help you to ensure that you fall within the prescribed guideline even assist you to work out your monthly financial budgets accordingly with critical adjustments needed, so that you could have enough disposable income to prove your ability to make the modified loan payment.

Financial hardship guidelines

To qualify for the Obama federal modification program, the applicant is required to furnish details of financial hardships faced, to the mortgage loan lender prior to availing a modification of the loan. It is imperative for you to know that a loss of home equity is just not a valid reason for a loan workout. As per hardship guidelines the generally accepted ones are mentioned below.

• Loss of income on account of job loss or increase in monthly expenses.


• Marital separation.


• Military services.


• Incidents involving death of family member or even co-borrower.


• Medical expenditures caused due to prolonged illness or hospitalization.


• Disasters arising from natural calamities.

Thus, prior to availing a mortgage modification, the entire loan modification process has to be thoroughly understood which could make your qualification much easier. A lot could depend upon the manner in which you would present your case. Considering the intricacies involved, it is always desirable to seek expert assistance from reputed online service providers like www.Refinanceitt.com who employ professionally qualified and highly experienced mortgage modification attorneys. This could enable you to get proper guidance when applying for modification of your current mortgages particularly with reference to preparation of legal documents that are needed to be submitted along with the loan modification application. Thousands of house makers have benefited with a home mortgage modification in the recent past. You too should not miss the opportunity and hence, apply for it right now!