Getting a Bank of America / BOA mortgage modification loan is not as difficult as the majority of people think. In fact, if you go about the process correctly, you are almost assured of approval. Many people get it wrong however and I am going to reveal the 3 pitfalls to avoid in this short article. Avoid these and you'll be in the clear.
Pitfall 1 - Poorly Drafted Hardship Letter
One of the main causes of failure when people go for a boa mortgage modification loan is failing to sufficiently craft a winning hardship letter. The hardship letter is important because it outlines your present circumstances as well as any steps you've taken to remedy your situation. It also gives the lender an opportunity to adequately asses your 'need' for the loan.
Pitfall 2 - Failure to Understand Debt/Income Ratio Requirements
Before you are considered for a modification loan the lender will assess your needs against what is called the debt/income ratio. This guideline stipulates that your monthly mortgage payments must exceed 31% of your gross monthly income. If you fall below this threshold, you are unlikely to be considered for a loan. Many people fail to work this out correctly and get rejected.
Pitfall 3 - Poor Finance Management
This is a big one and many people fail to get it right terribly. You see, if you are not able to meet the new modified loan commitment, you are unlikely to get approved. It should be obvious but many people work on everything else except this. Before you go for a boa mortgage modification loan, take the time to get rid of any monthly payments that are not necessary. Cut back on your expenses as best as you can. The lender will go through your financial situation with a fine tooth comb and any discrepancy or hint that you may not be able to pay will result in rejection.
So in summary, the 3 pitfalls above are the three main reasons for denial of a modification loan, but now that you have a firm grasp of them, you should have no problems. In fact, my parting recommendation is that you avoid any risk of denial all together and seek professional help. These professionals speak your lender's language and have the necessary experience to get your loan modification approved. There are plenty loan modification companies online that will handle your Bank of America loan modification application for you.
Hope this information is useful for you. For more detailed information on providers, kindly refer to the Right Pane.
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