Loan Modification

Who it's for

Modifications fit homeowners who had a real hardship — job loss, illness, divorce, a death in the family — but now have steady income that can support a new, affordable payment.

What your servicer will ask for

• A loss mitigation application and hardship letter
• Recent pay stubs or proof of income
• Two months of bank statements
• Recent tax returns and a signed IRS Form 4506-C
• A monthly budget of income and expenses

Protections while you apply

Federal mortgage servicing rules generally prevent a servicer from starting foreclosure until you are more than 120 days behind. If you submit a complete application more than 37 days before a scheduled sale, the servicer generally must review it before moving forward with the sale.

Most modifications start with a trial period of about three monthly payments. Make every trial payment on time.

Keep a paper trail

Send documents in a way you can track, keep copies of everything, and write down the name of every person you speak with and the date.