Loan Modifications Just Out of Reach

You can read all the numbers and all the statistics of how bad the economic crisis has become, but until it touches you personally, it's hard to completely understand how bad things have become.

My parents are both realtors, one in commercial and one in residential, so it's safe to say that they have not been immune to the recession and are in need of some debt relief. They have lived in their house for nearly 17 years, my sister has lived there her whole life, but they could lose it to foreclosure.

I did my research to help my mom figure out what she could do. My parents would not be able to refinance right now, but loan modification is another option that could work for them. In a loan modification your lender may be able to alter the length of the loan, lower the interest rate, or even cut down the principal balance. You don't have to undergo a credit check or have an appraisal done. You just have to be able to prove that you have come under financial hardship, but still have some income coming in that would allow you to be able to make your lowered payment.

Sounds like a great solution to their problems right? Well my mom has talked to her mortgage lender. They said that they are just a facilitator of the loan and because of that they can't do anything to modify the loan. So she went to the lender that holds the loan, the one whose name is actually on the title. That lender said that's all they are... a name one a title and they can't do the loan modification. That lender is the federal government.

There are private companies that do loan modifications on their own. With some of them you are basically hiring a lawyer to communicate on your behalf with your lender to try to adjust one or all three parts of your loan, interest rate, terms, or principal balance.

The government has setup a program specifically for modifying federal mortgages, so then why can't my family get their loan modified? No one wants to take responsibility or actually take any action that would help remedy any of the problems Americans are facing. This is just one example of the huge mess Americans are in, with no end in sight.