If you are having difficulty making your home mortgage payments you might be a candidate for loan modification.  The process of loan modification is not well understood by most homeowners. Here are some facts that may help you:

Almost any loan can qualify for modification, not just FHA.  You can modify any type of loan whether it's a jumbo, fixed-rate, adjustable-rate, FHA, HELOC, etc.  If you have a second mortgage you can modify it alone, both the first and second or both.

You don't have to be behind in your payments to qualify for loan modification. While you do have to prove hardship, you don't have to be delinquent in your mortgage payments.  Your bank will probably require a hardship letter from you.  Here's a link to some samples of hardship letters.  The most important thing is that you want to stay in your home and pay your mortgage.

Remember the debt to payment ratio your lender talked about when you first qualified for your loan?  If your income has dropped since then, or if you have accumulated more debt, it may now be out of the guidelines of your bank.  If loan modification can bring it back in line with that debt-to-payment ratio then you have a good chance of qualifying for modification.

How it works.  Most modification plans result in applying a lower interest rate to your loan.  If lowering the interest rate results a payment that works for you, and the lender is agreeable, that's it. Here's an on-line calculator to help you determine if your situation is right for loan modification.

A note of caution. There are lots loan modification of scams out there.  The best place to start the process is with your lender.  If that doesn't work contact an attorney.

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