01 May How Loan Modification Can Save Your Queens Home from Foreclosure
Are you lying awake at night, worried that missed mortgage payments might cost you your family home? Many Queens homeowners fear that foreclosure is inevitable once they fall behind – but there’s hope. A loan modification can be the key to keeping your home and getting back on solid financial ground, even if you’re already facing foreclosure notices.
Don’t let confusion about your rights or fear of the banks paralyze you into inaction. An experienced New York foreclosure defense lawyer can help you understand all your options, including powerful foreclosure defense strategies and loan modification programs that your lender might not have told you about.
We’ve helped hundreds of Queens families negotiate with their lenders to achieve more affordable payments and stay in their homes. Take the first step toward protecting your home and your future – reach out today for a confidential consultation where we’ll review your situation and create a clear action plan tailored to your needs.
What Is a Loan Modification?
A loan modification changes one or more terms of your mortgage. It might involve:
- Lowering the interest rate
- Adding missed payments to the end of the loan
- Extending the life of the loan to reduce your monthly payment
By making your mortgage more affordable, a loan modification can allow you to catch up on your payments and keep your home.
Under New York law, lenders are required to give you a single point of contact if you are behind on your home loan and seeking help (see NY CLS Bank § 6-o). This single point of contact must provide accurate information about possible solutions. That means you can speak with one dedicated representative about your options, including loan modification, instead of being passed around to different people every time you call.
How Does Loan Modification Work in New York?
New York has specific rules that can help homeowners who have fallen behind on their mortgages.
Here are some important steps in the process:
- Lender’s 90-Day Notice: If you miss several payments, your lender must send you a 90-day pre-foreclosure notice. This letter tells you that you are behind on your mortgage and that the lender can take legal action if you do not fix the problem.
- Summons and Complaint: If you do not bring your loan current or work out a deal with your lender, the lender can file a lawsuit in court to start the foreclosure process. Because New York is a judicial foreclosure state, the lender must get a court’s permission to foreclose on your home.
- Single Point of Contact: As noted, under NY CLS Bank § 6-o, your lender must provide a single person or team who can guide you through available options, such as a loan modification.
At this point, your best move is often to talk to a Queens foreclosure defense lawyer. At Poltielov & Habib, LLP, we can analyze your mortgage documents, your financial situation, and your lender’s actions to figure out the best plan to save your home.
What Happens if My Mortgage Is Sold During Modification?
Sometimes, lenders sell or transfer mortgages while a loan modification is in progress. In New York, the new lender or servicer must honor any approved or in-process loan modifications (see NY CLS Bank § 6-n). That means you should not have to start the process all over again just because your loan was transferred. The single point of contact requirement also still applies, so the new servicer must provide a clear person or team to handle your case.
What Is the Mandatory Settlement Conference?
New York law also requires a mandatory settlement conference in residential foreclosure actions (see CPLR R 3408). This court-supervised meeting is designed to bring the homeowner and lender together to find a solution that avoids foreclosure, if possible. A loan modification is one of the most common solutions discussed at these conferences.
During the settlement conference, both sides must “negotiate in good faith.” Our Queens foreclosure defense lawyers can represent you, explain your financial details, and negotiate for the best possible outcome. If you reach a loan modification agreement, the foreclosure process should be halted, which allows you to focus on making your new payment plan work.
How Do You Start the Loan Modification Process?
If you are behind on your mortgage, you can contact your lender and ask about loan modification. Often, your lender will give you a list of documents they need. These might include proof of income, recent bank statements, tax returns, and a hardship letter. Once you send these documents, the lender will review your request.
Common loan modification documents include:
- Proof of income
- Recent pay stubs
- Bank statements
- Tax returns
- A hardship letter explaining why you fell behind
Make sure you respond to your lender’s requests in a timely fashion. Keep track of your communications, including emails and letters. If you are worried about deadlines or unsure about next steps, get in touch with our Queens foreclosure defense lawyers for guidance. We can help make sure you submit the right documents and meet all legal requirements.
Do You Have to Restart if a New Servicer Takes Over?
No. As mentioned earlier, a new loan servicer must honor any modification in progress. New York law (NY CLS Bank § 6-n) protects you from having to begin the entire process again. If you find yourself being asked to redo all your paperwork, you should contact a Queens foreclosure defense lawyer immediately. At Poltielov & Habib, LLP, we will make sure the new servicer follows the law and ensure that you don’t need to start over if your servicer changes.
What If the Lender Approved Your Loan Modification?
Generally, a mortgage servicer will first approve the borrower for a trial modification which will go anywhere from three to twelve months. The purpose of a trial modification is to see if the borrower can actually afford the new monthly mortgage payments. Once a borrower successfully makes all trial modification payments, the lender will then extend a final loan modification. Once you have a signed agreement, the lender must stop the foreclosure process. Under New York law, the lender should file a notice of discontinuance and cancel any notice of pendency within a set time period after the deal is fully executed. You can then continue making your payments according to the new terms. This can bring a huge sense of relief, as you know you are no longer in danger of losing your home if you stay current under the new agreement.
How Can a Queens Foreclosure Defense Lawyer Help?
A Queens foreclosure defense lawyer can:
- Gather and submit the paperwork needed for a loan modification.
- Make sure your lender follows the law, including providing a single point of contact and honoring any loan modification in progress.
- Represent you at the mandatory settlement conference and negotiate on your behalf.
- Make sure you understand your rights and the terms of any new agreement.
Because the stakes are so high, having an experienced Queens foreclosure defense attorney can make a real difference. Many homeowners lose their homes simply because they do not understand the process. By hiring Poltielov & Habib, LLP, you can reduce stress and give yourself the best chance of saving your home.
Ready to Save Your Home? Contact Us Today!
If you are worried about losing your Queens home, do not wait any longer. A loan modification could be the solution you need, and the sooner you start, the better.
Let our Queens foreclosure defense lawyers at Poltielov & Habib, LLP, guide you through the process. We will work to reduce your monthly payments, stop foreclosure, and safeguard the life you have built in your home.
Call (718) 520-0085 or contact us online today to schedule your free, confidential consultation. Your home is worth fighting for, and we are here to stand by your side every step of the way.