I have spoken with quite a few people recently who have asked me the question “how do I know who to hire to help me get my loan modification done?”
If you are currently thinking of hiring an Arizona loan modification company or loan modification lawyer to help you with your loan modification, here are five simple questions designed to help you identify the “good” loan modification companies from the “bad” loan modification companies.
Arizona Loan Modification: How do you know if you can help me?
Before you say *anything* about your situation, ask this question. Most of the time, the person shopping for a loan modification will be so upset about their situation, they will look for someone to listen to them explain their situation first.
Resist the temptation.
Ask the loan modification company “how do you know if you can help me” first and let them do the talking. Let them explain how the identify how they know if they can help you or not, what they look for in order to know if they can help someone and what they have seen as far as results.
The more information that you can get from them up front, before you tell them about your situation, the more you will get a good idea if they really know what they are doing.
Arizona Loan Modification: Do you have three references of people who live in Arizona that you have helped get their loan modified?
Don’t miss this question and be sure to follow up and speak with their references first.
You will learn more from the three references they give you than you will from talking to anyone at the firm. You will learn what the process was like, how the company was to work with and what their overall impression of “was it worth it” was?
Arizona Loan Modification: Do you plan to use violations of law in my current loan as leverage up front or later on in the process?
In loan modification, there is an “easy way” to get it done and a “hard way”. The easy way is that the loan modification company starts talking with your lender and negotiates out a loan modification – just based on “what kind of monthly payment you can afford based on hardship”. Many times, the “easy” loan modifications are done in a matter of minutes and really don’t involve any kind of negotiation – because there is not a principal reduction involved – just a modification of payments.
For some situations, this type of loan modification is fine.
But for other situations – for example – for those people who are hundreds of thousands of dollars upside down in their home… “the hard way” may yield better results. “The hard way” involves the loan modification legal staff going through your documents that you signed when you got the loan and looking for violations of law. Many loans have these violations and “the hard way” involves using these violations as negotiation for a principal reduction or even a complete rescission – meaning your entire loan is rescinded and you will no longer even have a mortgage.
Arizona Loan Modification: How Much Do You Charge?
Note that this is not the first question to ask.
How much a company charges is an important consideration, but it is not the most important. The most important thing to consider is whether or not they can be successful at getting your loan modified and the question of “how much do you charge” tells you nothing about if they will be successful or not.
In general – expect a fee up front (generally ranging from zero to $3,000) and a fee if they are successful (generally 1-2% of your loan amount) and remember – if someone offers to do it for no money up front but doesn’t end up getting your loan modified, it is more expensive than if you paid $3,000 up front and a 2% of your loan amount as a success fee.
Arizona Loan Modification: Can you tell me what to expect in my situation when working with <insert your lender>?
Listening to the answer to this question will tell you something about their overall experience. If they say that they have never worked with your particular lender before… it is a sign that they probably don’t have a lot of experience yet.
If they tell you that they have a dedicated person to work with them at your lender – it is a sign that the “easy way” kind of modification will be easy – but “the hard way” is still going to be “the hard way” even if they have a dedicated person because it is going to involve attorneys fighting with other attorneys.
If you are currently looking into hiring a firm to help you get your Arizona loan modification done, by asking these 5 questions, you will be in a much better position to identify the “good” from the “bad”. And if you are in a situation where a loan modification is an option for you, you can’t afford not to invest the time to choose wisely.