The last three clients I spoke to were approved for loan modifications. About 20 before that were shot down.
The reductions in their monthly payments (among those approved) were from $500 to $1300.
I am so overwhelmingly negative and cynical about loan modifications that I don’t like to even hear myself talk about them. I sound worse than some crabby, old guy on the SCORE complaining about the White Sox bullpen.
I do believe that loan modifications are too hard to get and that they lead many homeowners down the path to foreclosure, instead of helping them.
This cool graph that shows how many loan modifications are cancelled and how many become “permanent” and it shows the percentages for each at all of the major lenders. Of all of the trial modifications applied for, about half are cancelled. It was surprising to me that there are such differences between lenders in the number of modifications made permanent.
Considering that half of those who get loan modifications end up in default again (after the modification) I still consider loan modification a long shot.