Wells Fargo Loan Modification – Tips for a Successful Loan Modification
While some people have reported incredible success with a Wells Fargo loan modification, others have found it to be an exhausting and fruitless experience due to failure to obtain approvals. So why the gulf in success and failure in this mortgage modification? The answer lies in putting together a few tips that go a long way in increasing your chances of success.
This article explores what these tips are and after reading it, there should be no chance of being denied a Wells Fargo modification program.
Debt to income ratio
This is a criteria on which Wells Fargo calculates its debt income ratio. This just means the amount of money you pay each month toward your mortgage fee expressed as a percentage of your gross monthly income. Also included in this calculation are any attached taxes, as well as HOA fees and insurance charges.
The debt income ratio is not supposed to exceed 31% and is sometimes also referred to as the affordability level. You will only be considered for the modification if you are paying more than 31%; otherwise, Wells Fargo will consider that you can pay your mortgage fees.
You need to understand your test payments
At the time you receive a special forbearance or trial modification, it is critical to know what will happen to the difference in monthly payments at the end of each month. The difference keeps growing, which means they are still owed until the loan is finally modified.
The worst way to get denied approval
It will help if your financial position hasn’t changed much from what you originally presented in the trial plan. A noticeable disparity on both sides could mean that the permanent mortgage modification has higher payments than the trial ones. Worse still, you could be denied approval on the grounds that your financial position has improved.
While Wells Fargo has stepped up efforts to prevent this from happening, it would be unwise for someone to double their income or even lose a job when the modification review is underway.
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