There are lending practices that are abusive and predatory in nature. How can you identify these? Below are questions that could help you determine fraud in lending. If you answered “yes” to any of the questions, contact the appropriate agency/agencies.
The information below will help you better determine if you have been a victim of mortgage fraud or predatory lending.
Mortgage Modification is defined as the process where the terms of a mortgage are modified outside the original terms of the contract agreed to by the lender and borrower. During this process, interest and principal payments are made till you pay off the mortgage in full and the lender holds the lien till then. Any change to the mortgage terms is a modification.
Negotiation
Are you thinking about applying for a Home Mortgage Modification? A likely candidate for such a program would be a homeowner who has an existing mortgage (created before January 2009) who is facing financial hardship. The source of this hardship can be lost income, medical bills, or that the cost of their mortgage has increased dramatically-such as when the initial interest rate on an adjustable rate mortgage expires. Often, the home has lost value compared to the amount the borrower owes, so the loan-to-value ratio is over 80%, which means that the borrower cannot refinance through conventional means.
There are programs available through the Federal government and administered by banks and other lending institutions. The Federal program, called Making Homes Affordable, is available to homeowners who have a good payment history on an existing mortgage owned by Fannie Mae or Freddie Mac; however, many lenders provide their own programs that do not have this requirement, so you should talk to your lender and see what programs they have available. You will have to select the program that is right for you.