Loan Modification Forum - LoanSafe.org - View Single Post - Loan Modification for multiple rental properties

t2weati · 12-13-2008, 09:49 AM

I contacted one of my lenders, PHH Mortgage. They hold the loan for 2 of my duplexes in Albany, NY. They sent me a letter about my inquiry regarding modifying my existing loan. The only program they have in place is a "Principal Curtailment modification" that deals directly with reducing the principal and interest payment amount. The interest rate, maturity date, and escrow payment will not change. The principal curtailment request (the amount to be requested by me) must be at least 20% of the unpaid principal balance.

They also require a $300 processing fee to begin processing my request. That is $600 for 2 properties. My current terms are 7.625% fixed for 30 years. Principal balance on each are around $148,000. I still have another 27 years left to pay. If I request the 20% curtailment, it would shave $29,600 off of the Principal Balance, changing the Balance to $118,400...which would be fantastic as it would shave about $200 off of my payments ($400 for both properties), but here is my dilemma.... According to Zillow (which I know is not accurate), it says that one of my properties is worth $192,000 and the other property I own (right next door) is worth $181,000. There is a house next door that is for sale. The asking price is only $138,000. I am guessing that if I went ahead and asked for this curtailment, it will be denied based on the fact that the house is worth a lot more than my current loan balance and dropping the principal by 20% to $118,400 may not make sense to the bank financially. I don't want to waste $600 on fees that will get me nothing.

Has *** or anyone else heard of this type of offer? Has there been success with a situation like mine? I'd love to get opinions on whether I should proceed and try it or forget the whole thing and save my $600.

12-13-2008, 09:49 AM	#16 (permalink)
t2weati Senior Member Join Date: Dec 2008 Location: Northern California Posts: 34 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Loan Modification for multiple rental properties I contacted one of my lenders, PHH Mortgage. They hold the loan for 2 of my duplexes in Albany, NY. They sent me a letter about my inquiry regarding modifying my existing loan. The only program they have in place is a "Principal Curtailment modification" that deals directly with reducing the principal and interest payment amount. The interest rate, maturity date, and escrow payment will not change. The principal curtailment request (the amount to be requested by me) must be at least 20% of the unpaid principal balance. They also require a $300 processing fee to begin processing my request. That is $600 for 2 properties. My current terms are 7.625% fixed for 30 years. Principal balance on each are around $148,000. I still have another 27 years left to pay. If I request the 20% curtailment, it would shave $29,600 off of the Principal Balance, changing the Balance to $118,400...which would be fantastic as it would shave about $200 off of my payments ($400 for both properties), but here is my dilemma.... According to Zillow (which I know is not accurate), it says that one of my properties is worth $192,000 and the other property I own (right next door) is worth $181,000. There is a house next door that is for sale. The asking price is only $138,000. I am guessing that if I went ahead and asked for this curtailment, it will be denied based on the fact that the house is worth a lot more than my current loan balance and dropping the principal by 20% to $118,400 may not make sense to the bank financially. I don't want to waste $600 on fees that will get me nothing. Has *** or anyone else heard of this type of offer? Has there been success with a situation like mine? I'd love to get opinions on whether I should proceed and try it or forget the whole thing and save my $600.