Solving the Knoxville Foreclosure Crisis
One Homeowner at a Time

Rick Smenner

RE/MAX Preferred Properties
[email protected]

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Knoxville Loan Modifications: Why They Don’t Always Work

KnoxvilleLoanModificationAreStressfulKnoxville loan modifications is one of the many alternatives distressed homeowners have to avoid foreclosure. Oftentimes, when a Knoxville homeowner is having difficulty making mortgage payments, loan modifications are one of the first things they try. Still, the Knoxville loan modification can be a long process, filled with countless calls to the lender, and oftentimes, loan modifications  don't end up working. So, why is it that most loan modifications fail? One big reason loan modifications don't work is that the entire process is a convoluted, bureaucratic mess. The lender you pay your mortgage to more than likely doesn't own the loan. More than likely, that lender services the loan for an investor. It is the investor who either approves or doesn't approve the loan modification. The lender, who you are making all the calls to and spending countless hours on the phone with, is just the middleman, for you and the investor. The investor that owns your loan is most likely a government entity, like Fannie Mae or Freddie Mac. Each investor has different requirements for them to approve the loan modification, which they then communicate to your lender which then communicates it to you.  It is because of this complicated process, with too many parties involved,  that loan modifications take so long to complete, if they get completed at all. Even if you successfully get a loan modification, they often carry a higher balance than the original loan. So even though the monthly payment may go down for sometime, you still owe more on their home than it is worth. And, eventually, your monthly payment increases, and you are in a worse place than before. Not to mention lenders can add all kinds of fees into your principle balance and increase your monthly payment without any notice. Knoxville loan modifications are a game of "pretend and extend," in many cases, even after distressed homeowners get a loan modification approved, they end up in foreclosure due to the fact that the payment eventually increases and they still owe more on their home than it is worth.  Or, while the loan modification is being discussed, the distressed homeowner goes into foreclosure anyhow. If you are having trouble making your mortgage payments and don’t know where to turn, please give me a call at 865-696-9002. You do have options other than foreclosure. My team and I spend a great deal of time keeping up with the many changes going on in the market and we are glad to help you. Email me [email protected] and let’s meet.

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