Solving the Knoxville Foreclosure Crisis
One Homeowner at a Time

Rick Smenner

RE/MAX Preferred Properties
[email protected]

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Knoxville Loan Modification Question – Can It Save My Knoxville Home?

loan-modificationIn our Ask the Expert Section, we recently received a question from Rudy, he asks, “My wife and I hit some difficult times awhile back. In between a pay cut at work and a few other high bills, it was difficult to make payments on our Knoxville home. We want to stay in our Knoxville home and now have the  money to continue making payments. I've heard about loan modifications. Can a Knoxville loan modification save my Knoxville home?" Rudy, you have a few different options to avoid foreclosure on your Knoxville home. A loan modification is one way that you could avoid foreclosure and stay in your Knoxville home. A Knoxville loan modification changes the terms on your loan. There are three different types of loan modifications.  A principal reduction reduces the amount that is owed your home. A rate reduction reduces the interest rate. A capitalization reduction takes what is past due and add it on the principal amount. Principal reductions are the most common (and successful) loan modifications. Earlier this year, the Federal Housing Finance Agency announced a new loan modification program that went into effect on July 1st. The new program is only available to loans owed by Freddie Mac or Fannie Mae. The program strives to make loan modifications easier for borrowers, since in the past loan mods were difficult and often ended in homeowners defaulting. For a Knoxville homeowner to be eligible for a loan modification, he/she must meet the following requirements: -The homeowner must be at least 90 days late and up to 24 months late on their mortgage payment. -The mortgage has to be at least 12 months old, and have a loan to value ratio equal or greater to 80%. -The mortgage cannot have been modified more than two times in the past. -Finally, the loan must be owned by either Fannie Mae or Freddie Mac. To see if you loan is owned by Fannie Mae, click here. To see if your loan is owned by Freddie Mac, click here. Are you facing foreclosure on your Knoxville home? Do you want to hear your options to avoid foreclosure? If so, please do not hesitate to give my team a call at 865-696-9002 or send an email to [email protected]. We’ve helped countless Knoxville homeowners avoid foreclosure. Give us a call today for a free consultation.

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