Asian Journal- The Filipino-American Community Newspaper

QUESTION: Why do I have to hire an attorney to negotiate loan modification when I can do it myself?

Answer: Consider the following:

Negotiation from a position of strength is what an attorney can do for you. If you do it yourself, the lender will dictate the terms of modification to your disadvantage. In my ten years of experience negotiating personal injury and other cases, you could get what you negotiate only if the other party knows that you will win in Court. To request a reduction in principal, I always recommend a loan audit and appraisal report to prove that there are violations in the lending process and the value of the property has gone down to its current value.

Lenders will not agree to a reduction in principal unless you can prove that the lender will lose more money by foreclosing the property. If the attorney can prove that there are violations in the lending process by the broker or the lender, there is a good chance of reducing the principal rather than spend time and more money in litigation. The most important tool an attorney has is the threat of litigation.

Loan modification is a legal process. There are Federal and State laws such as Real Estate Settlement Procedures Act (RESPA) and Truth in Lending Act (TILA), law of contracts and other laws that govern the relationship between lender and homeowner. Only an attorney has the experience and preparation to protect your rights to keep your home and avoid foreclosure.

Answer: Under the rule of professional conduct by the State Bar of California, an attorney should:

Have a face to face consultation with the client.

All legal advice should be made by an attorney and not by foreclosure consultant.

The attorney should communicate with the client on all legal aspect of the representation.

Answer: The basic differences are: