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R Fletch Asked:

I have a co-signer along with myself on my mortgage loan. My husband did not qualify become of self employment income. We are current on our loan, but having some trouble making the payments, and would like to inquire about a loan modification program. Is this unrealistic since we are current, and have a co-signer because their income will be included with mine, although they are not helping make the payments ? Also, my husband and I claimed ch 7 bankruptcy last year (because of the business debt) and received discharge in December 2008. So re-finance is out for us to release cosigner from obligation. Is there any hope for us to get a lower payment?? [Ann Arbor MI]

06/03/2009

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Answer Provided by: Drew Sygit [06/05/2009]
 

To get a loan modification, you have to prove financial hardhship and that you can't affford the current house payment. To start, you want to know if your loan is held by FNMA or FHLMC, FHA, etc. For FNMA or FHLMC, you can go to this website: http://makinghomeaffordable.gov/. The website also has some good info on loan modifications. The Obama administration has introduced s system of loan modification for lenders to follow on FNMA & FHLMC loans. Also, you do not have to be behind on your mortgage payments to qualify. If you're mortgage is FHA, you can find that out by calling your lender. If you're none of the above, then you have a privately securitized mortgage and there are no requirements for lenders to follow for loan modification. You also have to be careful as some FNMA & FHLMC mortgages are now held by companies that are not lenders and they do not follow the Obama modification plan. If it sounds a bit complicated, it can be! Regarding the cosigner - you will probably need to supply their financial info to prove their hardship, but you could also try telling the loan modification negotiator that you've burned a bridge with that person when you filed for bankruptcy and they will not speak to you. May be worth a shot. For even more info, go to this blog and read past posts: www.drewsmortgagenews.blogspot.com.