How to Negotiate a Successful Loan Modification
- 1). Lenders Aren't As Opposed to Modifying Loan Terms As They Once Were
With foreclosure at an all-time high, lenders aren't as resistant to negotiating mortgage modifications like they once were. If you are proactive, able to ask for a loan modification before your home enters the foreclosure process, you can save your lender thousands of dollars in lost revenue and fees; making them more likely to negotiate. - 2). Don't Be Confrontational
Too often people look at the negotiation process as something that must be confrontational. In reality, nothing is further from the truth. Instead of fighting your lender throughout the negotiation process, enter into it with the mindset that the two of you are working together to find a win-win solution to your problem. If you consider yourselves adversaries, the conversation will be a very different, and, and much less effective. - 3). Control Yourself
Facing your financial situation can be emotional. Add to that the stress of trying to convince your lender to let you off the hook for some of your debt, and you can quickly find yourself showing too much emotion. Don't let your pride, your sorrow or even your frustration get in the way. Keep your emotions in check with every bank representative you speak with. Some will be easier to handle than others so be especially careful when dealing with the harder ones. - 4). Do What It Takes to Make Your Modification Happen
Don't be afraid to ask your lender what you need to do to get your loan modified; than be wiling to do it! If that means selling your car or giving up your cell phone, than by all means agree! Some lenders don't ask their clients to make lifestyle changes in order to get a loan modified, but some do. Be prepared for either scenario. - 5). Tell the Lender What You Want
Now is not the time to beat around the bush. If you want your interest rate lowered to 5%, say so. If you need a payment under $1,200 a month; tell them! If there was ever a time to know exactly what you need and communicate it, this is it! - 6). Offer Several Options
Sure, you may want a 2% interest rate, but if you let your lender know you'll take a 4.9% interest rate; or a term extension as long as your payments are less than $1,500, you're more likely to get what you want. Show your lender that you've done your homework and know what you want and need by offering them several solutions. A few things you could ask for include:
