Can I Really Lower My Monthly Mortgage Payments?

Someone I had sold a house to many years ago and occasionally run into around town, called recently out of the blue. Knowing that I've been in real estate for over 20 years and had been a witness signer for many years, she thought I might have an opinion. She had received several postcards offering to "lower your mortgage payments" and was starting to pay attention to the t.v. ads she had also seen. I told her that I had also looked into it and was now a representative with a national company, so I was happy to answer some of her concerns.

I explained that it really was possible to lower your mortgage payments. With all the hype about loan mods on t.v., some people think that all they have to do is contact their lender and ask them to lower their payments. It's really not that simple or fast for anyone even if all the i's are dotted. The important thing to remember is that obtaining a lower payment is not a wish list item, it needs to be a necessity that can be documented. In her case, she was going through a divorce, he had moved out and ofcourse had taken his income with him. She wanted to keep the house and he didn't care if it went into foreclosure. Sounds like she has a legitimate hardship due to the reduction in her household income. She would also have to prove that her income alone would be sufficient if she could just get her payments lowered. In this scenario, however, there is a bitter divorce going on, the house is in both names and he won't cooperate in any way that would allow her to proceed before the divorce is settled. Meanwhile, she is eating away at her credit in order to maintain the payments until such time. For her it is a waiting game, what are you waiting for?

If you can foresee a hardship coming, an interest only loan that's soon to adjust, an eminate pay cut or loss of a second job, this is the perfect time for you to take preventative measures. The lender doesn't really want to foreclose and now there is a government incentive to negotiate a modification with the distressed homeowner. But, the agenda for the lender is to cut their losses not to save the homeowners' home. It would be hard to call it a negotiation when the homeowner is passively waiting for the lender to figure out the new terms. Which is why so many people are seeking the services of Attorneys who specialize in loss mitagation.

If the homeowner is absolutely unable to beg or borrow the attorney fees, then by all means I would recommend that they contact their lender directly and start that ball rolling. The end result will be a reduction, the question will be "is it enough"? If the lender were to answer that honestly, they would say "not my job".

Typical results from an Attorney based Loan Mod company would be to Stop foreclosure, Reduce interest rates, Extend terms, Fix their interest rate and Stop a future rate adjustment. If this sounds like something you could use and you can document your "hardship" and income, you may be eligible for a loan modification. Your credit scores or equity position will not matter.

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