How To Negotiate A Loan Modification
Purchasing a house has long been referred to as "the American dream". Nevertheless, that dream comes with a large price tag that includes fees and interest. When you got the home everything was going well and you felt great! Then something went wrong and things got tough. Yet, you don't want them to go more wrong so you have come to a point where you think you want to negotiate a loan modification to make things Negotiate A Loan Modification
Perhaps you have spent a few sleepless nights worrying about what could happen if the bank forecloses on your home. You go deeper into debt, without any equity to bargain with; or even worse, you could abruptly find you and your family are living on the streets wondering where you're going to spend the night. Regrettably, these scenarios are very real and they play out in the lives of thousands of honest families every day.
For whatever reason most people wonder if it's even worth it for them to negotiate a loan modification. Well, here are some numbers to consider:
$100,000 at 8% interest for 20 years will cost $836 per month, or $200,745 over the life of the loan.
But, if you can get a reduction of only two percentage points, look what happens...
$100,000 at 6% interest for 20 years will cost $716 per month, or $171,943 over the life of the loan.
That little difference adds up to a huge savings of $28,802. I'm quite sure you would agree that putting that much extra money in your pocket is a lot better than what could happen if you lose your home. That's unquestionably worth it, yes?
Mortgage companies are losing money like never before. Before you think they are going to do anything they can to make you stick to your original agreement so they can make more money, you should recognise that isn't always true. In fact, they are more likely to renegotiate so they don't lose money.
As a side note, your credit history will have an affect on how good of a deal you can receive so do your best to keep it under control or improve it before you go in to negotiate.
When you go in be prepared with any paperwork you need (ask ahead of time and make a checklist). You may not get as good of a deal as you would like, but if you remain flexible you should be able to come to terms that allow you and your family to keep your house.
The economic system has taken its price on lots of people, andthats not your fault There is no disgrace in reworking your original deal. As you saw, the numbers are in favor of trying to redo a loan modification. It boils down to whether you prefer losing whatÂ or saving tens of thousands of dollars.