The Wells Fargo loan modification experience has driven some people crazy, while others are reporting amazing success.
Here's a few tips to help make sure your modification is successful and help you keep your sanity through the process: Know your debt to income ratio - A very important calculation Wells Fargo uses is the debt to income ratio.
This number is the percentage of your gross monthly income that you pay for monthly mortgage payments, taxes, HOA fees, and insurance.
In short, what percent of your total income does the roof over your head cost you every month? The magic number here is thirty-one percent (31%).
This is widely known as the "affordability level".
If your paying less than 31%, Wells Fargo will consider that you should be able to afford your monthly payments.
If you're paying more than the 31%, you will come across as somebody in need of assistance and be a much better candidate for loan modification.
Understand your trial payments - When you receive a trial modification or special forbearance its important that you understand what happens to the difference in the monthly payments every month.
It grows as arrears (past due), meaning you still owe them that until the loan is permanently modified.
A modification should roll the entire past due balance into the loan, but you should always be aware of the entire amount past due.
Try not to let it get out of hand if you find yourself making trial payments beyond what was originally planned.
The worst way to get denied - It will be important that your financial situation has not changed much from the income you submitted when placed on the trial plan originally.
A big swing in either direction could cause the permanent loan modification to have higher payments than the trial, or worse denied for no longer being qualified based on current income.
Wells Fargo has been taking steps to eliminate this from happening but it's never a good thing to double your income or lose your job while in review for loan modification.
In dealing with a giant amount of modification requests Wells Fargo is always changing their internal policies and procedures.
The basics above will always apply whether you're applying for a government (HAMP) loan modification or traditional (In House) modification..
Here's a few tips to help make sure your modification is successful and help you keep your sanity through the process: Know your debt to income ratio - A very important calculation Wells Fargo uses is the debt to income ratio.
This number is the percentage of your gross monthly income that you pay for monthly mortgage payments, taxes, HOA fees, and insurance.
In short, what percent of your total income does the roof over your head cost you every month? The magic number here is thirty-one percent (31%).
This is widely known as the "affordability level".
If your paying less than 31%, Wells Fargo will consider that you should be able to afford your monthly payments.
If you're paying more than the 31%, you will come across as somebody in need of assistance and be a much better candidate for loan modification.
Understand your trial payments - When you receive a trial modification or special forbearance its important that you understand what happens to the difference in the monthly payments every month.
It grows as arrears (past due), meaning you still owe them that until the loan is permanently modified.
A modification should roll the entire past due balance into the loan, but you should always be aware of the entire amount past due.
Try not to let it get out of hand if you find yourself making trial payments beyond what was originally planned.
The worst way to get denied - It will be important that your financial situation has not changed much from the income you submitted when placed on the trial plan originally.
A big swing in either direction could cause the permanent loan modification to have higher payments than the trial, or worse denied for no longer being qualified based on current income.
Wells Fargo has been taking steps to eliminate this from happening but it's never a good thing to double your income or lose your job while in review for loan modification.
In dealing with a giant amount of modification requests Wells Fargo is always changing their internal policies and procedures.
The basics above will always apply whether you're applying for a government (HAMP) loan modification or traditional (In House) modification..