Great news for borrowers who may be facing foreclosure!
Florida borrowers two or more years late on their mortgage payments may get another chance to save their home following a change in loan modification rules.
It’s estimated that nearly half of borrowers nationwide who are ineligible because of the 720-day cap, would be able to get a loan modification through the program.
Lenders must comply with the cap elimination by April 1, 2015, but are being encouraged to make the change immediately. Borrowers who were previously denied a streamlined modification because they were more than two years late on payments must be reevaluated, according to letters sent to lenders and mortgage servicers Oct. 1.
The approval rate for the program is quite high.
Under the program, lenders send contracts to borrowers with new payment amounts. The modification could include a fixed interest rate, an extension of the loan to 40 years, and possibly deferring a portion of the debt owed to the end of the loan so it’s not included in current payment calculations.
Also, borrowers are encouraged to lookout for other loan modification plans, such as the Home Affordable Modification Program.
If the borrower agrees and makes three on-time payments, the modification becomes permanent.