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I have requested numerous time for my readers to advise me if someone or a company has help them resolve issue with loan modification. Here is a testimonial from a caller about this.
Dear Ken,
I have been following your article and followed your advice to call and negotiate with the lenders myself. I own two properties one is of a rental and another one that I live in. After hours and hours of waiting and being transferred a gazillion times, I finally got the approval from my lender Countrywide to reduce my interest rates to a payment that I am very satisfied with. My advice to your readers is that be patient and persistent. Be very organized, and they can do it themselves too, I have friends paying thousands of dollars to loan modification companies but am not getting any results. So I am happy that I have successfully modified my own loan. Your comments about loan balance reduction is true, none of the lenders is willing to reduce my balance, so I gave up that hope.
This caller was able to reduce his interest rate on one loan and the other loan, the lender extended the terms from a 30 to a 40 to help him reduce his payments.
Thanks for your input caller; I need more people like you contributing information to all of us. REMEMBER "Knowledge is Power that will reduce Fear."
Q & A’s
Caller: I have a friend who says they can refer me to a loan Modification Company for only $1,500 when I sign up and they will reduce my rates and loan balance. Ken is this true, can I really get my rate reduced and balanced cut? I would like your advice.
Ken: First of all, I am always advising people to make sure that when someone is going to refer you to a Loan Modification company, they should ask for proofs. Normally the person referring you will say things like this, "Hey, this company did my Loan Modification and reduce my payments or balance" call them or I can refer you. Stop them and say, can you show me your loan modification approval from the lender.
In this case, we ask for the homeowner to ask their friend for proof and the friend came back and said "it’s approved but not finalized." What does this mean? We said show me the pending approval? The friend said "it’s verbal;" well, that really does not mean anything right.
My suggestion is to wait till you see proof before signing up.
Comments by another reader who did the right thing.
This reader refinanced their loan over a year ago and cash out over $100,000. They were considering buying a property last year and have been offered multiple investment opportunities by numerous agents. With good, educated and informative consideration, this reader has decided not to invest in a property in ‘07-’08 and opt to keep their funds in a money market account. Of course, the $100K investment is not being utilized and losing interest money due to low money market rates, so they have decided to refinance their loan and put back some of the money that was taken out before. Now, they will reduce their loan balance and have a very comfortable payment with the amount of income they make. Their house is located in a good area and by paying down their mortgage they actually are in the debt to income ratio that will allow them to have excess funds to invest in their retirement.
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