What is a Freddie Mac loan modification?
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What is a Freddie Mac loan modification?
A Fannie Mae or Freddie Mac loan modification may lower your monthly mortgage payment. You may be eligible1 if: You’re having trouble paying your mortgage due to a financial hardship. Your first mortgage is owned by Fannie Mae or Freddie Mac. You own the home, and it’s your primary residence.
What happens during a loan modification?
A loan modification is a change to the original terms of your mortgage loan. Unlike a refinance, a loan modification doesn’t pay off your current mortgage and replace it with a new one. Instead, it directly changes the conditions of your loan.
How does Freddie Mac flex modification work?
Created under the direction of the Federal Housing Finance Agency, Flex Modification is intended as a long-term foreclosure prevention solution. A loan modification reduces your monthly principal and interest payments by extending the loan term or reducing the principal balance or interest rate.
Who qualifies for flex modification program?
Eligibility for a Flex Modification the loan must be a conventional first mortgage. you must have suffered an eligible financial hardship. you must have a stable income that will support a monthly payment, and. you must have taken out your mortgage at least 12 months before being evaluated for a Flex Modification.
How long does a mortgage modification take?
6 to 9 months
The loan modification process typically takes 6 to 9 months, depending on your lender.
Is it easy to get a loan modification?
No matter how focused your attention to detail, your credit score almost certainly will take a hit with a home loan modification. Often, a homeowner won’t get approved for a loan modification unless there is evidence of one or several missed payments. Those missed payments hurt your credit score.
What is the debt to income ratio for loan modification?
Generally, the simplest way to calculate a debt to income ratio for loan modification is simply to take total monthly debt obligations and divide it by total monthly gross household income. Anything over about 60-70% is pretty good for loan modification purposes.
