Mortgage Loss Mitigation Video #4
Loss Mitigation Strategies
Hi, I’m Nevada Loss Mitigation Specialist Damian Falcone.
This is part 4 of the mortgage loss mitigation plan video series. In part 3 we finished our 2 sets of questions for developing your loss mitigation plan. Today we will go through the comparisons you can make in evaluating your situation and knowing what your mortgage Loss mitigation plan will be.
Today we want to start by finding the % of your income you are directing to your mortgage. For this we will use the answers you provided to questions 3 and 6 in our first set of 7 questions. In Our example Mr. X has a monthly mortgage payment of $2,196 and an income of $4,100 so we can see he is allocating 54% of his gross income to his mortgage payment. The US Treasury Department provides counseling for individuals that allocate 55% or more of their income to their mortgage payment due to this being a high risk situation. Many - including the Home Affordability Modification Program set a responsible mortgage payment at 31% of your Gross income.
In our example Mr. X is in a situation where he: owes $300,000 at 6.5% providing for a payment that is $2,196/month –
If Mr. X were to request a loan modification he could reasonably ask for his mortgage to be reduced to a 2% rate (instead of 6.5%) which would provide him with a payment of $1,108.86 Plus the estimated taxes and insurance of $300 for a total payment of $1,408.86
Mr. X may really like the idea of a $1,400 mortgage payment and attempt a loan modification OR maybe he really wouldn’t like the idea and decide to propose a deed in lieu of Foreclosure, short sale or even Bankruptcy Protection.
To complete this series General Counsel Kaleb Anderson will go over some legal issues and possible situations including The Foreclosure Process, Deficiency Judgements, Bankruptcy Protection and Credit Reporting. These will be covered as they pertain to your mortgage loss mitigation plan and in more detail in their respective series.
I am loss mitigation specialist Damian Falcone and this is Get Modified!