Homeowners who are a little less than paperwork and negotiation savvy may want to look into loan modification companies to help get their modification request accepted with their lender.
Getting most lenders to approve a loan modification request can be like swimming against a fast current if done without professional assistance. the people who run and work within loan modification companies are not only trained to get the best modification agreements possible, but also to work together with lenders to reach a common goal. No lender is going to pass out modifications without due reason, and the words of a skilled professional can turn the tide in the homeowner’s favor.
In most cases, companies who handle loan modifications charge a fee after the application has been filled out of submitted or/and once they have come to an agreement with the lender. The fee for a successful modification is usually between 1 and 3 percent, while the charge after submitting the application can vary widely between different companies. It can vary anywhere from $200 dollars to $3,500 dollars.
Picking a company is more difficult than it should be, though. There are scam companies posing as legitimate modification companies all across the country, and it has become big enough of a problem for the FBI to launch a nation-wide crack down. There are two big, red flags that can indicate a scam:
1. The “company” gets in touch with the homeowner first. It does not take much effort on anyone’s part to get leads on homeowners who do or may need assistance from a loan modification company. Legitimate companies do not actively seek out clients — though some lenders do inform those who have been late on payments of their options.
2. Consultation fees are a huge flag. The vast majority of real professionals do not charge for the consultation, rather they charge for helping with the paperwork and successful negotiations. Even the most wary of homeowners have been sucked in by a seemingly legitimate company, only to have been charged a fee and skipped out on. Those who pay the fee and actually hear back from the scammers are asked to pay another fee, for one of many excuses.
Checking with the Better Business Bureau will also yield results as to the legitimacy of loan modification companies. It can be difficult to distinguish the real from the fake, and sometimes it’s too late to tell until the homeowner has lost thousands of dollars.
If a homeowner can find a legitimate loan modification company, then they are well on their way to getting out of a big foreclosure mess.
