Can I Do My Own Orlando Loan Modification?
The short answer is yes; you can do your own Orlando loan modification. If you are an avid do-it-yourselfer [DIY], and are willing to dedicate the time, energy, and effort, you can do your own loan modification. One thing to understand upfront, though, is simply because you can do-it-yourself, does not mean that your results will be equal to someone that does loan modifications regularly and consistently. The question to ask becomes, not can you – but should you. Just as you can represent yourself in court or build your own kit-car, you can do this. This article contains resources whichever you ultimately choose.
I imagine it would be helpful to know what your options are going to be at the end of this article, would it not? In order to make the time reading this fruitful – at the end - I will ask you what you think the best option for you is. Obviously, the answer is for your own benefit since his conversation is only taking place in your own head. =0) See, I am not the only one that has conversations in my head!
Option 1: You don’t have to do anything. I will give you all the information you need and if you are not ready to decide yet, that will be just fine.
Option 2: You can do this all on your own. Every day, people are attempting loan modifications all on their own, and if you decide to do it all on your own, just make sure you are adequately prepared.
Option 3: You can work with a solicitor that contacts you for you loan modification. You may save some money up-front by choosing a call center and many people that haven’t read this article are choosing that every day.
Option 4: You choose to work with me because you believe I am your very best option.
So at the end of this article, I will pose that question… fair enough?
So - which one is the right one…
First, let’s define the possible pathways. Under the umbrella of the commonly used term ‘loan modifications’, there are actually distinct directions… modification and mediation.
Loan Modification
The first is loan modification itself. This is chosen when the homeowner wishes to modify one or more of the terms of their mortgage. Whether it be the lowering of their interest rate, changing their ARM to a fixed mortgage, or extending the term from 30 to 40 years, etc. Making these changes is completely voluntary on the part of the lender so it is vital to have a game plan in place that will include, not only a hardship letter in your handwriting, but also the documents to back up the hardship you are presenting. [More on that later.] About 100% of the time, no exaggeration, I get the question about reducing the outstanding principal balance.
The hard truth is that, despite what you hear on the news, only 2% of loan modifications actually result in a principal reduction. I know, I know – your co-worker’s sister’s friend’s nephew’s neighbor who lives in Phoenix did their own loan modification and cut the mortgage balance in half and lowered their rate to 1% fixed for 40 years after their first call. I know. I have heard that too… can never seem to actually track this prodigy down, but I have heard the story nonetheless. If you choose an attorney to represent your interests with a loan modification then you should expect to pay around $2300 to $3300… most of which is likely refundable.
Loan Mediation
The second of the two pathways is Orlando loan mediation. If you owe more than your home is worth or simply wish principal reduction as a primary objective, which is what we are finding in most of the cases for Orlando loan modifications, then you may skip loan modifications all together and explore loan mediation.
Boiled into its simplest form, loan mediation is accomplished by engaging an attorney on on retainer [is that good English?] to facilitate an Orlando forensic loan audit of the mortgage file. Yeah, it sounded intimidating to me at first too, but in essence, all it means is the attorney explores in great detail if all the proper steps and guidelines were followed by the lender. Here are a few of the things that are done. [Since half the people reading this are likely wanna-be loan modification ‘experts’, I will limit the specifics to a select few points.] Such as;
- Calculation and analysis of Federal Real Estate Settlement Procedures Act [RESPA]
- Predatory Lending Analysis
- Federal Fair Lending Act analysis
- Financial Benefit analysis on cash-out refinances
… and 16 other very specific procedural and feasibility examinations.
Mediations analysis does not just relate to the original handling of the mortgage, but also the custodial chain of documents if your mortgage has ever changed hands and timelines under RESPA.. The only way to do this is with an attorney in your corner. Is it worth it? That is for you to decide. It is not at all uncommon for attorneys to be able to skip the first two options a lender will offer direct to homeowners simply because all emotion is removed from the equation. [See the DIY section for the four common tactics of a lender-homeowner negotiation.] A reasonable fee to expect to pay is between $2800 and $3800. Due to the fact that you are retaining that attorney to do the forensic loan audit, the fee they charge is probably not refundable.
Option # 1: Doing Nothing
Hello? Is this mic on? If you wish to do nothing, click here.
Option #2: Doing it Yourself
Okay, now that we know what to reasonably expect if we choose worthy representation, let’s talk about a couple of the things to watch out for if you decide to DIY.
Set your mind to recognize that this is truly a David v. Goliath scenario. True, in the original account of history David was victorious - but unless your lender is an, “uncircumcised Philistine that has defied the armies of the living God“, I would encourage you to recognize the outcome may possibly be different.
Fact #1: The lender negotiates for the lender. If you are fortunate enough to get someone on the phone – know that they are not representing you or your interests.
Fact #2: The first person you talk to is never the person you should talk to. Even if you are in the right department, get to a decision maker as soon as you can. Don’t bother explaining your situation unless you enjoy doing it over and over. Better yet. Record it the first time you share it, you can be assured when you are transferred, you will be starting over.
Fact #3: They will always offer less than what they can deliver. First rule of negotiation, is it not? In modification, there are several different layers of what a lender will do directly with the homeowner and they typically follow this order. For example, will what they offer you protect your credit?
- Forbearance
- Temporary Modification [Soft Mod]
- Permanent Modification
- Principal Reduction [Typically a last resort]
If you would like to attempt this on your own and would like a FREE 15 minute phone consult with me to gain a couple of tips, please email me to that effect and three time slots that you have available during business hours and I will try t work you in.
Option #3: Dealing with a Solicitor
Warning #1: BEWARE of loan modification companies that charge an upfront fee where your agreement is not directly with the attorneys doing the work. Don’t misread what I stated. It is not uncommon for attorneys to charge the fee upfront – just beware because under law, attorneys are the only ones that can. I have heard stories where folks are getting calls that ‘state’ that the work is done by attorneys and there is no fee until the end if/when it is successful. The only charge up-front is the “$99 processing fee.” My opinion? Sounds like a great way to lose $99. Have you ever personally witnessed an attorney working for free? Looks good on TV, I know – but in real life? Mmmm – I haven’t.
Warning #2: BEWARE of not having attorneys do the actual work. Get specifics. It is illegal in most states to have anyone other than an attorney [imagine – attorneys coming up with a law like that] do this kind of work. It is not that you would necessarily get in legal trouble if someone else were doing it, but what does that say about the individual you chose? Best case they are working with a lack of due diligence, worse yet it is in spite of the law – “dat is not gwood”.
Warning #3: BEWARE of people that guarantee specific changes such as:
- Specific rate changes
- Principal balance reductions [remember, only 2% of modifications result in this.]
- New payment terms
- Time frame
While it is human to feel better when we hear the word guarantee, it is crucial to know that every scenario is 100% unique. Your personal circumstances, the lender’s position on homeowner-direct modifications, the type of loan you have, etcetera, all influence a final outcome. You have better odds at guaranteeing an outcome while playing roulette than what a lender is willing to do in your specific case.
By the way, are you on the do-not-call list?
Option#4: Working with a Trusted Resource
First and foremost – I am a Certified Mortgage Planning Specialist [CMPS], not a modification expert. That statement may scare some of you, but I am curious how soon you will realize that it is actually quite refreshing. Let me tell you why you don’t want a modification expert… because you are dealing with contract law and that should be handled solely by those that practice law – not a self-proclaimed loan modification expert on the internet. Savvy?
Next – Loan modifications and mediations are not for everyone. With a price tag of between $2300 and $3800 as noted above [some even charge more], you should be able to get some reasonable That being said, you may notice that the costs of a loan modification/mediation –though nothing to sneeze at – are quite a bit less than the other options you likely have. Let’s compare the other options on the table. assurances that you are not placing that money on RED and spinning the wheel.
- Refinancing – This is only an option if two things exist in the same scenario. Both the homeowner and the property qualify. As you likely know, even in a perfect financial situation on part of the homeowner, if the property is significantly upside down as we are in Orlando in many cases, this ‘ain’t gunna happen’. I think this is what should be explored first, however. The cost of such is probably double what loan modification would be. The benefit would be the ability to avoid having to come up with the fee by being able to roll those costs into the new mortgage assuming the value of the property would allow it. If you were referred to this article by a mortgage professional – consult with them about this option… not me. The purpose of posting this is not to pull business away from other good mortgage professionals, but rather to combat much of the mis-information out there in the marketplace. If you weren’t introduce to this content from another mortgage professional, by all means - feel free to contact me. =0)
- Short Sale – If you are current on your mortgage and wish to get out from under the house with your credit intact, this may be the right option. The mortgage originator that directed you to this article can lead you to a Realtor that is a Short Sale Expert. Don’t be fooled – a ‘short sale’ is anything but short. If you are going to travel down this road, make certain you are working with a Realtor that “gets it” when it comes to Short Sales. Don’t attempt it with someone unfamiliar with the process. If you do, I offer my condolences in advance.
- Short Refi – This is basically a short sale without a new buyer. A new mortgage is attained after the current lender agrees to a short payoff. Your mortgage broker will provide a letter to the current lender in order help facilitate the new transaction. Now, since you are qualifying for a brand new mortgage, you can’t have any late mortgage payments. Ask yourself… why would the new mortgage company take on a risk that the other is trying to dump unless they qualify like any other borrower?
Foreclosure – this is the worst possible outcome, but is the default course if nothing else is done… like choosing Option #1. No one wins with foreclosure. Not the homeowner – not the lender, not the neighbors, not the economy. Avoid if you can by getting sound advice from a mortgage planner and your current financial advisor. Your financial advisor might not be a professional, but get input from whomever you currently trust and turn to for financial insight. If you would be interested in an introduction to a true professional in the financial advice world, let me know. I am glad to help with an introduction.
Bottom Line
Listen folks, do your own homework, as I have. As a trusted resource for many people over the last seven years as an Orlando mortgage advisor and as a Certified Mortgage Planning Specialist, I found that it was imperative to find a rock-solid resource for loan modifications and mediations. As more and more people were requesting my help, the need became apparent that not finding a resource was equivalent to returning them to the “murky waters” filled with all the sharks. I found that unacceptable.
So, remember the options at the beginning? What’s it going to be 1, 2, 3, or 4? Remember – not to choose is to choose.
If you choose option 4 because you believe I am the best choice, there are a few different ways to reach out to me.
You can:
email me,
call me at 407 377 0500 x 210,
or begin the Loan Modification Worksheet.
Orlando Mortgage rates are suffering through another volatile week, causing problems for mortgage rate shoppers and Orlando home buyers.
home buying ambitions? The
The obvious question arises - 
