Help from a Loan Modification Lawyer in Hoffman Estates and Surrounding Areas

Facing the loss of your Hoffman Estates home to foreclosure can be one of the most daunting experiences of life. Fortunately for Chicago area homeowners who are underwater, there are protections and options outside of a court ordered foreclosure. Thanks to recent changes in the rules that govern how mortgages are serviced and modified issued by the Consumer Financial Protection Bureau in January of this year, struggling homeowners have options including loan modifications, short sales, and deed in lieu of foreclosure. A loan modification, if approved, will not only allow you to keep your home but will make your mortgage more affordable.

Keep Your Home, Lower Your Payments

Loan modifications provide permanent changes in one or several terms of a mortgage that often result in lower payments that the borrower can afford. This process takes the mortgage out of default by reinstating the loan, allowing the borrower to keep the home. Terms that are changed under a loan modification include a reduction in the interest rate, reducing principal, adding overdue payments on the back end of the loan and extending the life of the loan. Furthermore, because a successful loan modification can prevent the foreclosure process, a borrower’s credit is protected from further harm. It is imperative to take action before a foreclosure sale date has been issued.

Feds Extend Help to Homeowners

According to the New York Times, the current administration is extending its Making Home Affordable program through 2016 and may extend it further, if needed. Since the inception of the program, there have been nearly two million mortgage assistance actions in the United States with an average reduction in monthly payments of $544, according to the Department of Treasury & Housing and Urban Development.  The Home Affordable Modification Program (HAMP), which is part of the Making Home Affordable program, was designed to reduce monthly mortgage payments for borrowers who were delinquent on their home loans and covered loans entered into prior to January 1, 2009. The program was set to expire on December 31, 2015. Through HAMP, a borrower’s mortgage interest rate can be reduced to two percent for the life of the loan and delinquent payments could be added on to the back of the loan to minimize out-of-pocket costs.

What You Should Do

If you are a struggling homeowner in the Chicago area, there are a few things you can do to help save your home from foreclosure.

1.         Ask for help now – Previously, loan modifications were only available to homeowners who were more than 90 days late on their payments and the lender filed a motion to start the foreclosure process. Today, some lenders will work with you before then, and the federal assistance program does not require default to be eligible.

2.         Seek a professional  – It can be highly beneficial to seek help from an attorney who has experience in the process. As a result of the real estate bust, many companies have emerged preying on struggling homeowners. Do your research before choosing whom to use.

3.         Fannie vs. Freddie – Knowing who holds your loan can help with the modification process. A mortgage may be held by Fannie Mae, Freddie Mac or may have been sliced up when banks were buying and selling mortgage-backed securities during the boom.

4.         Be transparent – Once the loan modification process begins, be completely honest about your financial situation no matter how difficult that may be. Information needed to expedite the process includes household monthly gross income, previous years tax returns, balances and minimum payments due on revolving credit, and information about your assets, among others. The priority is to save your home and anything less than full disclosure will only harm you.

We Are Here to Help You

Contact an Illinois real estate attorney today if you may be losing your home to foreclosure in Hoffman Estates, Illinois. The Law Offices of Gilbert C. Schumm specializes in foreclosure defense and serves the communities of northwest Chicago including Hoffman Estates, Schaumburg, Palatine, Des Plaines and Bartlett.