Mortgage Modification in 2010

In 2009 I spent a lot of time with clients trying to figure if they’d qualify for a mortgage modification. In 2010 it takes me about 5 minutes and is nearly 100% accurate. That’s because the banks, in their rush to streamline, have become so very standardized and predictable.

I say standardized…The Making Homes Affordable Program Guidelines have become the standards. All in-house programs are modeled after the MHA, although they are not nearly as rich and generally are even harder to get. But the guides are pretty universal.

I say predictable because the sheer numbers of applications has forced the banks to routinize everything – including erroneous rejections – to a point where it is pretty obvious to us veteran loan mod freaks.

You’ll get a mod if 1) you have a typical hardship (income down, expenses up…duh!), 2) your loan qualifies (non-jumbo, made before 1/1/09), your ratios are right, 3) you live in the home, and you are in default. That’s not to say that landlords have no hope they just have less likelihood of approval and should have lowered expectations.

Now, just because you are qualified, don’t think your mortgage modification is guaranteed. In fact, that’s just the “table stakes” in this game! You have to know how to play…and, that means getting an advantage over the thousands of competing qualified modification applications that are submitted each day. That’s right – thousands each day!