| In the state of New York in order for a lender to | | | | negotiation of a home loan modification. A loan |
| foreclose on a home they must follow a judicial | | | | modification can in many cases be the answer to the |
| process. The lender needs to sue the home owner. | | | | problem. Like anything else there are benefits and |
| This process begins with the lender processing a | | | | disadvantages to a mortgage modification. We have |
| summons and complaint. When the borrower receives | | | | compiled a list of the advantages and disadvantages |
| notice of intent to foreclose the borrower has 20 days | | | | for you to consider. |
| to respond. If no action is taken by the borrower then | | | | ADVANTAGES:A successful Loan Modification will |
| the lender has the right to move for a summary | | | | supply you with the following: |
| judgment. | | | | 1. an interest rate reduction. Under President Obama's |
| Once the court grants a foreclosure procedure then | | | | current program this rate may be as low as 2%. |
| the court will appoint a referee, who will determine the | | | | 2. The advantage of having the reinstatement amount |
| amount owed by the borrower and how the property | | | | (total amount of late payments) deferred to the back |
| will be sold. The referee files their report to the court. | | | | end of the mortgage and added to the current |
| The court confirms the report and enters a judgment | | | | principle. |
| of sale. This stage of the process may take from | | | | 3. A reduction in the actual principle balance of the loan |
| 12-18 months. The notice of sale is published weekly | | | | 4. Has many of the same features of a refinance, |
| for four to six weeks. The sheriff or referee may | | | | without the high cost. |
| conduct the sale at the time and place designated in | | | | DISADVANTAGES: 1.You only get one shot at the |
| the notice of sale. | | | | Loan Modification so you need to get it right the first |
| The officer will execute a deed to the successful | | | | time. It is important that you make sure your mortgage |
| bidder when the sale is complete. The successful | | | | modification sets up payment perimeters you can |
| bidder must deposit 10% of the bid price at the time of | | | | afford. |
| sale, and close with the balance due within 30 days. | | | | 2. Your mortgage company does not earn money |
| The officer shall then submit a report of sale to the | | | | making you modifications so they will most likely offer |
| court for confirmation. The lender may bid the total | | | | you terms that are not actually helpful. |
| amount due. If no one else bids, the property reverts to | | | | 3. Due to the high rate of foreclosures there are an |
| the lender. | | | | abundance of scams out there set up to take your |
| A motion for a deficiencyif applicable must be filed | | | | money, that promise to help you with negotiations. To |
| with the court within 90 days of the date of sale. The | | | | avoid these scams NEVER PAY A |
| court will determine the market value of the property | | | | DOWNPAYMENT TO ANYONE OFFERING TO |
| and award the greater of market value or auction | | | | ASSIST IN A MORTGAGE MODIFICATION. |
| price to the lender. | | | | Discover how you can ethically modify your home |
| How can this process be stopped? | | | | mortgage loan and save as much as 47% off your |
| There is an alternative to foreclosure that will allow | | | | current mortgage payment in as little as 60 days |
| you to save your home. This is through successful | | | | without refinancing? |