Interested in finding out if you qualify forIndymac’s federal modification plan?  Stop, before you submit your loan modification application to your lender, read this important information. There is a lot riding on this-are you sure you have completed all of your paperwork properly so that it has the best chance of approval? The truth is that more homeowners are declined than are approved-make sure you will not give the lender a reason to decline your workout. Here are 3 reasons Indymac could turn you down-make sure you know how to prepare your paperwork so you give your lender a reason to approve you-not decline you.

Know the Guidelines

Loan Modification Decline Reason #1: You have not proven an acceptable financial hardship-this is one of the basics for determining a qualified candidate for a loan workout. Indymac must verify that your circumstances have changed since you first got the loan, and so you can no longer afford the monthly payment that you originally agreed to. Loss of job or income, illness or medical expenses, divorce-separation, military service, interest rate re-set are all some valid hardship situations. Loss of home equity alone is not. In addition to completing and signed a Hardship Affidavit, you must provide your bank with a compelling and convincing Hardship Letter that contains 3 important elements-do you know what they are?  Use the handy Hardship Letter Outline provided in Chapter 10 of The Complete Loan Modification Guide to be sure you include all the required information.

Loan Modification Decline Reason #2: You have not convincingly proven that you will be able to afford to pay and maintain the new modified loan payment and will not be a risk for re-default. The #1 thing your lender is concerned with is that you can afford to stay in your home even after the loan workout is granted. There is a high rate of borrowers defaulting again after their loan modification-you have to prove that this will not happen to you.  Your budget or financial statement will itemize all of your income and expenses-it is critical to work on this form ahead of time and then make any necessary adjustments before you call your lender.  You need to have all of this information prepared before you call Indymac.

Learn how to Qualify before you Apply

Loan Modification Decline Reason #3: You have not met the federal guidelines for approval regarding debt to income ratio and disposable income. Obama’s plan calls for a new payment that equals 31% of your gross monthly income-and the bank must use only approved methods to reach that goal. Your loan modification application paperwork must prove in black and white that you can meet those guidelines. Do you know how to demonstrate clearly to your bank that you do meet their criteria for approval?  There is a standard formula that Indymac will use to determine if you qualify for the federal loan modification plan.  You can learn and use this very same formula when you prepare your application-and greatly increase your chances of approval.

This is important stuff-make sure that you do not give your lender a reason to deny your loan workout application. Your goal is to give your bank all the reasons they should approve your loan workout-and you can do this clearly and decisively when you know the guidelines for approval and then prepare your paperwork so that it has the best chance of meeting those guidelines. This is too important to leave to chance-learn the formula for approval so you can submit an acceptable application.

You can get the help you need to apply and qualify for a loan modification by ordering the best selling handbook for homeowners, The Complete Loan Modification Guide. This is a low cost, easy to read, home edition loan mod kit that will provide you with everything you need to prepare a professional and acceptable loan modification application. You are provided with all of the necessary forms and given detailed directions on how to complete them properly.

Home Edition Loan Modification Kit with Customer Assist

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