Can someone explain what exactly is a mortgage loan modification program is, does it affect your credit or is anything negative reflected on your credit reports and scores? There is a situation where a friend was out of work for a while and down to their last dollar but finally is starting a new job next week and wondering whether to get do a loan modification would help save the house and allow them to stay there, or if they should just do a quick sell or rent the house for a while. They would like to stay but doesn't want to go into any debt or very little and especially doesn't want to hurt their credit. They heard loan modifications hurt your credit.The job comes a few hundred short of covering all her expenses and wondering if a lower mortgage payment via a loan modification would help and not hurt their credit. Thanks!
I'm sure a lot has changed since I was enrolled in the program in 2009 and there are probably more financial situations now that allow you to qualify for a remod. From my experience you had to be late in mortgage payments for your lender to even consider you. I never qualified but when I was enrolled my 1st mortgage and HELOC lenders both reported me current on payments during this time and never changed those reports. I ended up doing a short sale which saved me from the nightmare of a foreclosure. I'm sure there are many more options available now... your friend should research them now before his situation get worse. I hope he finds the help he needs.
Depending on how your friend's credit looks, I would look into just refinancing their home loan. It sounds like unemployment has not effected their credit yet. Rates right now are at a all time low (3%). The only bump in the road would be the gap in employment. Was the gap in between jobs for very long? Thanks! Heather with BoostMyScore.NET
Has your friend missed any mortgage payments yet? I agree that she should look into a refi first if she's not behind on the loan.
