The solution proposed under Wachovia mortgage modification is to impose a fixed rate to home loans, thus transforming the whole debt into something one can actually afford to pay. By taking on a Wachovia loan in the first place, borrowers set themselves up for trouble as they were faced with increasing loan balances. If we add the crisis of the housing market and the decrease of property values to the equation, borrowers were really left no choice but to surrender to foreclosure. The loan modification program has appeared as an answer to these problems, saving both the borrowers and the lenders who had offered the loans in the first place.
In order for one to qualify for this loan modification program, there are two main eligibility criteria: the borrower must reside on the property, this being either a single family unit or a condominium; and the debt ratio must reach 45%. Properties that have two to four units do not qualify for loan modification. In the same way, having a debt ratio of over 45% is a reason for rejection. The program has many advantages, starting with the facts that the mortgage rate is no longer adjustable, that the lender will agree to liquidate missed payments gradually and that homes with declining values are finally given a chance.
Offering an interest rate of only 2% for a period of two years, this loan modification program appeals to many borrowers who struggle with unaffordable mortgages. This is one extremely appealing alternative to foreclosure, many homeowners preferring to escape financial hardship by resorting to loan modification. They find out all the information they need about the process involved in changing the terms of the loan when applying for one of these loan modification programs. Saving their home is the top priority.
Lenders have agreed to take part in the Wachovia mortgage modification program given the fact that they needed to recover the money lent in the first place. They prefer to concentrate on changing the terms of bad loans, making them affordable and giving borrowers the opportunity to meet monthly payments. By offering a loan modification program, they have reduced the possibility of default and are contributing on their own to an improvement of the housing market. It was high time that measures were taken, especially as the number of delinquent borrowers kept on increasing and foreclosures were so common. Payments are now made affordable, the interest rate is reduced and the homeowner is not suffering from financial hardship any longer.