If you are interested in getting a loan modification then there is a good chance you are suffering from some serious financial problems. Most likely, there are a number of options available to you, including foreclosure, a short sale and other mortgage defaults. What many people are unaware of are the implications each of these will have on their credit rating. Pretty much any financial transaction you make will have some impact on your credit, either good or bad, and so people who are homeowners or looking to take out or adjust a loan, must pay special attention to these impacts.
Foreclosures
According to some analysts, foreclosure activity jumped 7 percent from June 2009 to July 2009 and is up 32 percent from just one year ago. Basically, the national statistics suggest that one in every 355 households with a loan got a foreclosure filing in July 2009. Those numbers are not just historic; they are frightening and make loan modifications an absolute necessity for anyone in danger. A foreclosure will have a terrible impact on your credit score; and, depending upon how long it takes to get the situation straightened out, that negative impact could last quite a while.
Short Sale
A short sale is when the homeowner sells the property, but the proceeds from the sale fall short of the balance owed on a loan. People who own homes that have lost equity often fall into this category. A short sale can have a major negative impact on your credit rating, and it can still leave you in debt. If the lender decides not to accept the officer, it could cause all sorts of problems.
What many people do not understand however, is that it is not necessarily the foreclosure or even a short sale that negatively affects your credit. The actual number of months that the borrower has been delinquent on their payments is going to cause your credit score to drop. Simply walking away from your home will have an even harder impact because you made no attempt to talk to a lender to try and solve the problem. TransUnion, one of the major credit reporting agencies, published some figures stating that in August of 2009, the number of mortgage holders who are 60 days past due on their payments increased for the tenth straight quarter.
Loan Modification
People suffering from serious debt problems and facing potential foreclosure should contact a California loan modification attorney for answers. A loan modification attorney can help you work with your bank or lender to get the best loan modification possible, or just to see if you are indeed eligible for a loan modification. With a loan modification, you can stay in your home and avoid a foreclosure, as well as protect your credit rating. During such harsh economic times as these, your loan modification attorney could be your best friend because he or she can help protect you against the economic factors damaging other people’s lives. If you have an experienced California loan modification attorney, you are on the right track to protect your home and your future.
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