Filing Personal Bankruptcy Help

Thousands of people submit mortgage modifications applications every day with errors. Significant errors. Errors in the basis for the whole application – the gross household income! Since the mortgage modification is, for many, the best hope of keeping their homes and since the income section is the very foundation of the application, this is a big problem indeed. dozens of people review their applications with me each week prior to submitting to the bank. The majority make errors in the Income Section of the application. They get their own income wrong! So, let me tell you what I tell them:

1. Include the right household income. That is, you must include the income from the parties signed on the loan. Any other household income need only be included at your discretion. So, even if your spouse, partner, significant other or adult children or parents contribute income, you need only include their income if you decide to.

2. Calculate the income correctly. Sounds unbelievable but many folks actually calculate their own income incorrectly. It’s not uncommon to have clients using net instead of gross, mixing bi-weekly with semi-monthly paydays for calculations and using prior year’s W-2 instead of more current proof. I recommend writing your calculations on the pay proof itself. For example, write “This is a weekly pay check. The gross amount of this check X 52 and divided by 12 is how I calculated the monthly income used in my budget”. Sounds way too basic? Believe me, it’s not. Basic is good.

3. Document your Income extensively. I say extensively because I recommend you go beyond what is normal or expected. Think of it as an actual loan application and document it like it’s going straight to underwriting. This includes, notarizing self-employed P&L, including annual award letters AND check stubs for SSI and EDD income, Attestation Statements (signed and notarized) on bank statements when used to show deposits to document cash earnings, etc. Sure, some of these measures are beyond what the bank requires, but the requirements are met by the hundreds of thousand s of others in line ahead of you. Your application has to stand out and be bullet-proof.

4. Add to your income if you need to. If you do not have enough income to qualify for the modification then you have to add to it. To apply when your ratios are too high (income too low) is a waste of time. Some ways you can add to your income include: If you are self-employed, use best recent period Rent a room Rent a garage 2nd job Kids pay rent Parents pay for care, driving, room, etc. Contribution Letter

5. Reduce your income, if you must. That’s right, some clients fail to qualify because their mortgage payment is too small a percentage of their household income. They actually have to reduce their income! Some ways my clients have reduced their incomes in order to qualify include: Remove income from any household member not on the loan Scrutinize untraceable income – like tips Remove “at risk” income – like bonuses based on company performance Scrutinize expense items on self-employed P&L

Don’t go beyond the income section of your mortgage modification until you get it spot-on. Once it is right you can craft the rest of your application with confidence.

Need help actually getting Mortgage Modification? Visit Rockwood’s site about DIY Loan Modification at Home Loan Modification

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