When Do I Qualify?

Since there are no official loan modification guidelines, you can’t know for sure what will happen in any given situation. The loan modification process varies from lender to lender, and from borrower to borrower. So, there is no rule stating that you cannot receive a loan modification. Remember, the lender does not want to be stuck with a property where the mortgage is higher than the worth of the home. They will work with you as you should consult a loan modification attorney or real estate attorney.

However, there have been reports that if you are current on your mortgage payment, it may take a bit longer for your loan modification process to begin. The analogy goes... if you walk into an emergency room, the people with the worst injuries get top priority. That doesn’t mean you will definitely have to wait, it’s just something to be prepared for.

The Government Option

The Home Affordable Modification Program (HAMP) is a part of the Obama Administration’s Home Affordability & Stability Plan designed to reduce at-risk borrowers' monthly mortgage payments. Under the Home Affordable Modification Program, as long as you say “yes” to each of the following criteria, you are eligible for a loan modification even if you are current on your mortgage payments:

- You are the owner-occupant of a one to four unit home
- Have an unpaid principal balance that is equal to or less than:
* 1 Unit: $729,750
* 2 Units: $934,200
* 3 Units: $1,129,250
* 4 Units: $1,403,400
- Have a first lien mortgage that was originated on or before January 1, 2009
- Have a monthly mortgage payment (including taxes, insurance, and home owners association dues) greater than 31 percent of your monthly gross income
- Have a mortgage payment that is not affordable due to a financial hardship that can be documented.