Loan Modification: Right, Wrong, Indifferent

Oow, my eye. So, what's the skinny on Loan Mods? There are a couple angles; none of which are easy or pretty...and only a handful are getting through. One way is to go right to your existing lender. The rub here is that if you're not in some form of default and/or hardship, they're not motivated because you pay on time. Solution: Default a couple months on your loan and see if they want to talk then. The Rub: You've hosed your credit, they might not play, they might foreclose on you. Talk about a punch in the head. Your other general option is to use a Loan Mod broker, who will probably in turn take it to an attorney who specializes in putting the fear of litigation to the banks and leveraging extortion to get your rate and/or balance lowered. Direct to the attorney or via broker, most have a $3000 to $4000 "refundable" deposit. The argument here is that if you had $4k, you wouldn't be needing a loan mod this month. Additionally, IF you fit the guidelines, it's another $3000 to $4000 to close the deal. Pick your poison. I'd rather be dragged through glass and rubbed in salt than broker loan mods. I'm all about the refi or purchase loans, but I'm here to talk. Pat Townsley, Banking Knowitall. 415-485-1776. www.ptre.net