Does your lender want to give you a loan modification? Loan modification success rate is only 5%

Are you having difficulty getting approved for a loan modification? Does it feel like a fight? Why, if my lender says they will help me, does it keep telling me “Loan Modification Denied”? Here is the answer; You’re not alone. Below is evidence that shows lenders don’t want to provide loan modifications to homeowners and explains the low loan modification success rate of only 5%.

The lenders who perpetuated the largest Ponzi scheme in world history are as reluctant as ever to help their victims: homeowners who the lenders knew couldn’t afford the mortgages they gave them.

Remember when the banks came to Congress hat in hand and we watched the congressional hearings justifying the huge price of the bailout package because it would help homeowners who fell victim to the housing crisis? ?

So fast forward another year or two, and now the banks are solid again, and guess what? Foreclosures are at record highs (1.9 million foreclosure notices in 6 months, source: Realty Trac)

Before you lose sight of the core problem, keep this simple mantra in mind; The purpose of a loan modification is to get your lender to agree to take less money from you so you can pay for your own home.

Conceptually that may sound simple. But when have you met someone who is willing to accept less money, especially if her position is backed by legal documents and an army of lawyers to enforce her rights? So looking at it from that perspective, doesn’t a very low loan modification success rate make sense?

Where did we get the idea that lenders were going to help us? Well, for starters, that’s what they tell homeowners every day, one by one, with phone calls and letters. Have you ever heard someone say, “My bank told me they would work with me and all I have to do is send in a few documents.”

So do you know what happens next? They claim that they are so busy “helping people” that they will not be able to access their documents for 1-2 months. So they don’t tell you that they lost your documents, and then they deny you because your documents are outdated and incomplete. (source: Loan Safe Real Reports from Homeowners).

Here is an example. Remember when banks had to stop foreclosures because they got busted for cutting corners? It was on October 8 that the three largest mortgage services closed foreclosures. Do you know how quickly the banks fixed that problem? Only ten days later they did it again. (New York Times)

So ponder this question for as long as it takes to absorb it. Don’t you think that if the banks Dear to give you a loan modification, wouldn’t you already have one? How else to explain this loan modification success rate: Less than 5% of delinquent mortgages receive modifications. The fountain? An article from the Federal Reserve Bank. (Federal Reserve Bank of Boston Public Policy Discussion Paper No. 09-4, “Why don’t lenders renegotiate more home mortgages?)

Don’t you think they have you right where they want you? It would be like if a guy stopped you in an alley and told you that he was going to help you out of this situation. Are you really going to fall for that?

The next time you hear someone say, “Okay, I’m talking to my lender, they said they’d help me,” won’t that sound a little ridiculous now?

So it’s clear that even though your lender SAYS they’ll help you with your loan modification, the evidence is to the contrary. In light of the facts, it is reasonable to conclude that lenders perpetuate an image of cooperation to appease homeowners and regulatory groups, but the results show that their true intentions are to subvert as many loan modifications as possible.

If all of the above is true, then what do you say to the homeowner who asks, “How do I save my house from foreclosure?” What can be done to improve this lousy loan modification success rate? The answers are two: (1) learn and (2) get help. Read as much as you can, because knowledge is power. For example, wouldn’t it be a good idea to know how your lender will use the financial information you provide? After all, lenders use this information to determine IF you qualify and what your payment should be. Most people have no idea. And knowing this before you start talking to your lender gives you a distinct advantage.

A free site shows owners what that number might be. http://www.qualifyin15.com Then find some good help, because saving your home is too important to leave to job training. You must take positive steps to counter the 5% loan modification success rate.