6 Questions to Ask a Loan Modification Attorney

Utilizing a loan modification attorney to help with the loan modification process is very common. A loan modification is a process where a homeowner makes changes to a loan so that they can meet the requirements of the monthly payment. This is a process that is used as a way to stop or prevent a foreclosure of the home.

1. How Will You Help Me?

A loan modification company should first tell you how they can help you. This means that you will not undergo a series of questioning before they first tell you about their company and practices. By letting them tell you their process, you will avoid becoming a victim of someone trying to tailor the answer to what you want to hear versus what they can actually do for you.

2. Ask For References

A loan modification company that is designed to help people with loan modifications should have a track record that can be proven. This is a business where they work directly with the client to achieve a successful result. Ask for at least three references that you can call and speak with about their services. Ask the references about how successful they were as well as if they felt the price they paid was in synch with results.

3. What Will I Be Charged?

Although this is not the most important question, you should also ask about the fee their services. The most common structure for payment of these services is to pay an upfront fee as high as $3,000 and a success fee if they get your loan modified. The success fee will range from 1 to 2 percent of your modified loan.

4. How Will You Modify My Loan?

There are essentially two ways to modify a mortgage. The first way is for the loan modification attorney to call the lender and speak to them about how much you can afford with specific details about your financial hardship. This is an easier way of reaching an agreement but has limited results.

The first approach does not work well with borrowers that have a severe upside down loan, where the home is tens or hundreds of thousands dollars inflated. This kind of loan needs a reduction in the loan amount and can only be achieved with extreme leverage on the buyer’s side. This means digging into the actual loan documents and looking for legal errors.

5. Do You Contract Work Out?

This will let you know if you are dealing with someone directly or a middle man. The middle man will increase prices which lets you know you can get a better deal somewhere else. Although contract work can also give big payouts, you should know what you are getting into.

6. Have Any Of Your Employees Ever Been Convicted of A Felony?

Although this may seem like a harsh question to ask, it is imperative to ask because there are many scams out there. Along with this question, you can ask if they do background checks on those people that they do hire. This will tell you a lot about the company’s integrity.

These questions will help you find the right loan modification attorney to best assist you when you are looking to negotiate with your lender.