The recession has taken a serious toll on American households. If you or a loved one is in danger of missing mortgage or other loan payments because of layoffs or illness, banks are now willing and able to help. However, nothing can change until the debtor asks for a modification. Here is a brief overview of the mortgage loan modification process.
Step 1: Calling Your Lender
Loan modification process begins with a phone call to your mortgage company. With luck, you will receive contact information for a mortgage officer or adjuster who handles modifications. This individual will be able to learn more about your household’s dire financial circumstances and can change the terms in order to make the loan more affordable for you and your family.
Step 2: Negotiate Loan Terms
During the back-and-forth negotiation, borrowers may not be aware of the concessions their lender can make. If the loan officer does not mention it, you should directly ask about the best ways to lower your monthly payment and also reduce your interest rate for the length of the loan. Research interest rates for new mortgages and ask the adjuster to meet these benchmarks.
Step 3: Receive Loan Modification Offer
The last step is to receive a formal letter from the bank specifying the new terms of your loan. Depending on the bank’s backlog of modification requests, you may find this letter in the mail days or weeks after your last negotiation. This lengthy document will explain your legal obligations and ask for your signature on one of the copies of the agreement. Once you return the signed copy to your lender, your loan is officially modified.
If you are locked into a loan with a high interest rate, you may be able to negotiate to modify the terms of the loan to save money. San Diego and Escondido area residents should call (858) 240-2480 to speak to the skilled attorneys at Golden State Law Group. We can help you make the most out of the modification process, so call today to get started on your case.
Credit worthiness is important whether you are applying for a mortgage or taking out a personal loan. Your score can affect many facets of your life, so it is important to make informed choices whenever possible. While every financial situation is different, read on for the answers to some of the most common credit-related questions that consumers have.
Can Debt Collectors Hurt My Credit Score?
If you are delinquent on a loan, your lender will contract with a debt collection agency to recover a portion of the unpaid debt. These companies have the power to garnish your wages and lower your credit score for non-payment. However, if you suspect that the collector is harassing or hurting members of your household, you have the right to sue the lender for violation of the Fair Debt Collection Practices Act.
How Can Bankruptcy Help Me With My Credit Card Bills?
If you carry a great deal of credit card debt and are struggling to make your payments, filing for Chapter 7 bankruptcy can help you wipe away these debts. This is because a Chapter 7 proceeding works to discharge unsecured loans by liquidating certain property and forgiving the remainder of the bill.
Can Checking My Credit Score Hurt Me?
No, checking your score online will not hurt your overall credit rating. You should not be afraid to log onto to credit reporting agency websites in order to look over your score at least once every year. However, too many credit inquiries from credit card companies can lower your score, so avoid applying for external lines of credit if you plan on filling out mortgage applications.
When it comes to your credit and financial matters, both state and federal laws govern your options and consequences. If you are considering bankruptcy or loan modification, speak to a local attorney to understand your legal choices. San Diego households in need of financial advice should call (858) 240-2480 to consult with the experienced team at Golden State Law Group.
All consumer loans fall into one of two categories: secured or unsecured. The specific classification of each loan can determine the legal consequences of non-payment as well as lender response.
Secured loans are backed by property. In the event of default, the lender has the right to repossess and sell off the property that was purchased with that loan. Meanwhile, an unsecured loan is one that is not backed by another asset—which makes it a risky lending proposition for the bank. Common examples of unsecured loans are credit cards and student loans.
Since every household’s mix of secured and unsecured loans is different, it is important to consult a local bankruptcy or loan modification attorney before taking any legal actions. The attorneys at the Golden State Law Group have been helping Southern Californians for more than 35 years. We offer free initial case evaluations to all first-time clients, so call (858) 240-2480 to begin your path to a debt-free life.
Medical bills are by far the most common cause of bankruptcy in the United States. This video explains how those without health insurance often face mountains of bills at the conclusion of their treatment.
Medical debt is considered a type of unsecured loan, since the money owed to a hospital is not backed by any property or collateral. This means that the debt can be discharged during a Chapter 7 bankruptcy proceeding, allowing families to start over with a clean slate. Since not all households qualify for Chapter 7, it is important to consult with a local bankruptcy attorney to fully understand your situation.
Do not let medical bills plunge you and your family into a cycle of poor financial decisions. If you are in danger of losing your home and are unable to make payments on your hospital bills, the Golden State Law Group may be able to help. Our attorneys have decades of experience with bankruptcy in Southern California, so call (858) 240-2480 to schedule a free initial consultation today.
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