will rental property affect modification?

[charlie]

I'm sure our situation is unique, we started investing in real estate shortly after 9/11 to try to compensate for a 50% pay cut my husband had and loss of his retirement. The rentals all are carrying themselves with small positive cash flow which we use toward our primary mortgage. We have a 5yr option arm that is about to readjust (2nd time)Jan '09 and have only been able to make the minimum payment, therefore neg-amming at an alarming rate.
Any idea if this will negatively affect our modification chances. We have never been late nor missed payments. Just wondering how they will view all of these properties on the financial statement..thanks

[Cat Damiano]

Hi charlie,

Welcome to the forum and thank you for joining..............

The modifications given are up to the investors on the loans...........what you would need to do is to go over the financials with Chase because they might only calculate a certain amount of rental income on your financial statement.............they should be able to help you with this part of the expenses.............the only way having rentals may negatively impact a modification on your principle residence is if you had negative cash flow from each........
Chase Loss Mitigation
1-800-848-9136


Please keep us posted on your progress.......

[charlie]

Thank you for your quick response and excellent site!! That was the answer that I was hoping for. Will keep you posted as to my SUCCESS with this process..Many thanks!

[HopingtoFind]

We are currently in the middle of trying to modify a rental property with Chase. Initially when Chase took our financial information they never said anything as to how they will look at rental income. When later on we were assigned to an analyst she mentioned that they might only consider 75% of rental income.. I don't understand how that could possibly work... Our mortgage payment at this point is $1620 a month, not including taxes insurance, utility and maintenance expensese. Our total rental income from the rental is $1800. With taxes, insurance, etc added in we are couple of hundred dollars negative. If they consider only 75% of that income, we would be major negative... so don't know how they can consider only portion of income and still modify...

[charlie]

Thank you so much for your input....that's basically what I had heard through the grapevine.... especially when looking at net/income ratio's..we have 27 properties that are all self sufficient but use that income toward our primary. That is why I think my financial analysis needs to be right on the money. Thanks for the info..wishing you the best of luck on you modify!! Let me know how things progress..

[HopingtoFind]

You're welcome.. The problem is that it might also depend on investor, ours is Freddie Mac.. so you never know I think when you originally submit if they will look at your whole rental income or just a percentage.. And if your income is too high for example they might not modify.. Best of luck to you as well and keep us posted.