I see advertisements all over the Internet trying to get me to take advantage of the government mortgage relief plan by getting a Loan Modification. It got me curious about the success rate of this program and what the chances are of having a successful Loan Modification.
Alan Zibel, a Real Estate writer for the Associated Press, wrote a report a few days ago that looks at these questions. He made some interesting discoveries. You can read his full report here: Loan Modification So Far. He found that only 4% of homeowners who have attempted to get a loan modification have succeeded. Of course your odds of getting a loan modification largely depends on who your lender is.
To explore this Mr. Zibel looks at the numbers for Bank of America. He first points out that getting a loan modification with Bank of America requires more time than with other lenders. "...be prepared for the long time it takes to get an answer," he said, "the difficulty in accessing anyone to ask a question, and the reoccuring battle of lost paperwork and new phone numbers to fax or call." If a homeowner endures the ambiguity of silence, the frustration of changed numbers, the inaccessibility of assistance, and the possibility of lost paperwork... what are their chances? In the past Bank of America has only successfully completed 98 modifications. To put this in perspective GMAC has successfully complete 7,100 loan modifications since March!
How much work and stress do you want to go through for a 4% success ratio (even worse if you are with Bank of America)? A watchdog report this week says this government program "appear[s] capable of preventing only a fraction of foreclosures". There is a better way. If you're behind on payments or are afraid of foreclosure, contact Utah Dave's CDPE for additional options.
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