Many homeowners have had trouble paying their home loan payment each month and, in some cases, home loan modifications have not been enough to make the mortgage payment more affordable. Instances such as this can often trace their troubles back to second liens on home loans that can make a homeowner’s monthly mortgage payment too costly.
Yet, the second lien modification program is hoped to assist homeowners who are having difficulty with a second mortgage on their home loan. Various factors like unemployment or cutbacks in wages have caused many homeowners to find themselves in a position where they are unable to pay for their home loan, but in a mortgage situation where a second lien is the cause of the problem, many of the nation’s top mortgage servicers have begun using this second lien modification program to aid homeowners.
The second lien modification program can reduce the interest rate on a second lien, extend terms of a second mortgage so that it’s more affordable, or require that a second lien servicer allow a forbearance when one is granted for a first lien. Mortgage servicers like Bank of America, J.P. Morgan Chase, Citigroup, and Wells Fargo, among others, are participating and there have been reports that all mortgage servicers must implement this plan by January 1, 2011.
Homeowners who are trying to save their homes from foreclosure have, in some cases, complained that a mortgage modification did nothing to lessen the burden of their mortgage situation. Again, this was typically due to a second lien on a home but with the second modification program available, it’s hoped that more affordable and long-lasting foreclosure prevention plans can be offered through modifications when second lien servicers are on board.