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Educational Consumer Tips

Loan Modification Consumer Tip

Author: Better Business Bureau
Published:

Are you having trouble keeping up with your mortgage payments? Have you received a notice from your lender asking you to contact them? Do you want to take advantage of lower interest rates and lower your monthly mortgage payment?

If you answered yes to any of these questions, you are probably seeking to modify your home loan.  A loan modification is a permanent change in one or more of the terms of a borrower's loan, allows the loan to be reinstated, and results in a payment the borrower can afford. The ultimate goal is, and should always be, to help you keep your home and to provide you with an arrangement that works for your financial situation.


Consider the following BEFORE hiring a company to modify your home loan:
 

  • Call your lender first to see what they can do to help.
  • There is FREE help to modify your loan.  It is a red flag if a company asks for money upfront to modify your loan.  The consumer Financial Protection Bureau (or CFPB ) has more information at http://www.consumerfinance.gov/mortgagehelp/ 
  • If you decide to use a mortgage service provider, check with the Nationwide Mortgage Licensing System (NMLS) at (240)      386.4444 or www.mortgage.nationwidelicensingsystem.org, to verify the loan originator you are using is licensed.
  • If you are facing foreclosure and need help, contact the Phoenix Field Office for the Department of Housing and Urban Development (HUD) at 1.800.225.5342 or www.hud.gov. You may also wish tocontact the HOPE NOW Alliance, a cooperative effort of home loan counselors and lenders.  HOPE NOW can be reached at 1.888.995.HOPE or www.hopenow.com
  • If you wish to hire an attorney, make sure you get all the details of the modification in writing.  Be advised that attorneys charge fees for their time and not necessarily for results.   If you would like to verify an attorney’s license, you can contact the Arizona State Bar at (602) 252.4804 or www.azbar.org  . 
  • Be cautious of any company that may ask for an upfront fee.  Check the company out with the BBB at www.bbb.org before doing business with them.  Verify the business is licensed to do a loan modification by checking with the Arizona Department of Financial Institutions at (602) 771.2800 or www.azdfi.gov .