bank is trying to forclose our house, worth 234000. and only owe 97000. no sale date yet, working with a lawyer trying to resolve, bank just gives the runaround.
Received a letter from National Advocacy Program in CA, we are in PA. They are saying they can help us to get a settlement. IS this company leget? We have been working with a lawyer, his only solution is bankrupcy, which will cost us 3000.00. The Advocacy also is 3000.00, which they want me to send to them and they say this can be solved in 90 days, when we have been working with the lawyer for 6 months and the bank refuses to modify. Do I trust anyone? We do not want to loose our home, but do not know who to turn to.
It sounds like what you received in the mail was an advertisement to sell you services. Typically these outfits operate with commissioned sales people that make big promises but with no guarantees.
We need to start with one basic premise, no bank is required to modify any mortgage for any reason.
If you owe so little on your home and it is danger of foreclosure the best ways to protect what equity you have are to either sell the house, bring your payments current, or file a chapter 13 bankruptcy. But in a chapter 13 bankruptcy you will still need to make your regular mortgage payment plus an amount to bring your mortgage current.
Another point to consider in the advertisement you were mailed is if the attorney behind the service is not licensed to practice law in Florida then they can’t represent you as your lawyer.
I’ve written about the National Advocacy Program before, click here to see those posts.
Be sure to first read How Not to Get Scammed by a Mortgage Loan Modification Company.
First you’ll need to determine your current debt-to-income ratio. The target debt-to-income ratio under the Home Affordable Modification program is 31%. Use this free online DTI calculator.
Mortgage Modification Calculator
The mortgage modification eligibility calculator will ask you several questions and then show you which programs you may be eligible for.
Free Mortgage Modification Help and Counseling
If you have questions about the process or eligibility you can call 888-995-4673 and get connected with an mortgage modification adviser for free. This help is provided by government subsidized HUD Housing Counselors and they can be a big help in navigating the modification process.
In order to assist you, the housing expert will need to gather some information from you. Have the following documents handy:
- Information about your first mortgage, such as your monthly mortgage statement.
- Information about any second mortgage or home equity line of credit on the house.
- Information about the monthly gross (before tax) income of all household members contributing to pay the mortgage, including recent pay stubs if you receive them or documentation of income you receive from other sources.
- Information about your savings and other assets.
- Account balances and minimum monthly payments due on all of your credit cards.
- Account balances and monthly payments on all your other debts such as student loans and car loans.
- Your most recent income tax return.
- It may also be helpful to have: A letter describing any circumstances that caused your income to be reduced or expenses to be increased (job loss, divorce, illness, etc.), if applicable.
You can also get free help and housing counseling from a local HUD approved counselor. You can find your local free housing counselor, here.
Contact Your Mortgage Company
Not sure if your mortgage company offers modification programs? Not all do. You can contact your mortgage company to ask them about mortgage modification programs you might be eligible for. Click here to find your mortgage company.
Want to know the net present value (NPV) of your home for the mortgage modification process? No problem, use the free NPV calculator to find out. The NPV calculator is right here.
The calculator can be used by homeowners who have been denied a HAMP modification because of their NPV result or can also be used by homeowners prior to applying for a HAMP modification to help them better understand the NPV evaluation.
No Advance Fees
The Federal Trade Commission has a Mortgage Assistance Relief Services Rule which prohibits advance fees for mortgage rescue services or mortgage modification help.
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