Kentucky Loan Modification
The 2008 ended with good news for the real estate industry in Kentucky. Activities related to foreclosure went down by 19% compared to last month’s activity. This rate was achieved even after the state experienced a 34% decrease in foreclosure. Kentucky is also one of the states that have reduced its foreclosed properties when compared to last year. Compared to the same time period, a 44% reduction in the number of foreclosed properties was noted.
However, this performance in the real estate industry in Kentucky may soon be gone. Like most states in the country, Kentucky’s unemployment rate is rising. The 2009 could be the year where the state will be experiencing a rise in foreclosure filings. The unemployment rate is directly related to foreclosures since the ability to earn of the property owner will help him or her prevent the foreclosure of their property. When there’s no viable source of income, foreclosure due to missed mortgage payment is a likely possibility.
Preventing the Worst Case Scenario
Although the forecast in the real estate industry in Kentucky is negative, it doesn’t mean that foreclosure will likely happen to you. Even though you missed your mortgage payments for a couple of months, there is a way you can prevent foreclosure in your property.
One of the most popular ways today in preventing foreclosure is to go on loan modification. Basically, loan modification is a form of transaction between you, as the debtor and the financial institution as the lender. In this transaction, you try to convince the lending company that you are unable to pay the current mortgage arrangement since you have lost your ability to earn. As already indicated, unemployment is on the rise in Kentucky so there’s a possibility that you will find yourself in this form of transaction.
A “True Good to be True” Concept
Some would say this type of transaction is almost impossible since this is practically asking the lender to lower down your debt. But more and more lending companies are actually entertaining this idea since foreclosure will do more harm than good based on the current real estate situation. When they go for foreclosure, the selling price of the foreclosed property will be very low that the company could experience significant losses. Instead of going into foreclosure, they just agree to cut down a small percentage of the debt of the property owner which could still be profitable in the long run. Loan modification places both parties in better situation.
A Limited Service
Not everyone could avail of loan modification. Before you go into this type of transaction, you have to show first to the lending institution that you are in a “hardship situation”. This means that you are really having a hard time paying not only in mortgage but in other bills and loans as well.
For this reason, you might need the assistance either of a real estate lawyer or a loan modification company. They could assist you in preparing the documents to show that you are currently in this state. Real estate lawyers and loan modification companies could also help you reach a better agreement with your lending company.