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Do it Yourself Loan Modification - 7 Deadly Sins to Avoid

Looking for information on how to convince your lender to approve your do it yourself loan modification? Not every borrower will qualify for these loan workout programs, so make sure you know the 7 deadly sins to avoid when you prepare your loan modification application. It can make the difference between approval and denial!

Deadly Sin #1: Contacting your lender before you understand how the process works and what your lender needs to see in order to approve your application.

Deadly Sin #2: Paying a loan modification company a large, upfront fee without first verifying that the company is properly licensed and has experience with loss mitigation. Unfortunately, many homeowners have paid thousands of dollars without ever seeing any results instead of beginning their own do it yourself loan modification application.

Deadly Sin #3: Wasting time trying to speak with your lender about a loan modification when they call your home. The employees calling you at home are from the collections department, they will not help you with a loan workout. They will tell you anything to get your last dime-these employees get paid based on how much money they get out of you. You need to know who to speak with at your lender to get the results you need.

Deadly Sin #4: Not writing a convincing and compelling description of your hardship situation so that your lender will empathize with your situation. It is important to know the 3 key elements of a winning hardship letter-if you do not convince your bank that you deserve a loan workout due to circumstances beyond your control your chances of approval are slim.

Deadly Sin #5: Omitting information on your application or completing the forms wrong can be a reason for a delay or even an immediate decline of your proposal. Do you know that your bank will verify all of the information you provide? This is a full disclosure process-you can avoid this deadly sin by making sure you disclose all of your income and debts completely. There is a sure fire way to make sure you do not leave anything out.

Deadly Sin #6: Submitting a loan workout proposal that does not meet your lenders requirements for approval. Each bank has certain criteria that must be met-if your proposal does not fit into this criteria, you will be declined. Make sure you know your banks guidelines and then complete your loan modification forms accordingly. Do you know how to determine your target mortgage payment so it is affordable and meets those approval guidelines?

Deadly Sin #7: Not providing your lender with a complete loan modification proposal package that includes all the forms and documentation they need to review. Your bank has thousands of borrowers just like you who need help-what do you think happens to your package when it is missing items and cannot be processed? It gets set aside and finds it's way to the bottom of the pile-there goes your chance for a loan workout solution!

A successful do it yourself loan modification means you have avoided the 7 Deadly Sins and have prepared a professional, acceptable and complete loan workout proposal. Do you know how you can make sure that you have given yourself the best chance for saving your family's home? Research, learn and prepare before you contact your bank about your loan workout-this is too important to take chances-help is available if you know how to get it!

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