| Today there are many home owners that have paid | | | | a hardship letter. The hardship letter is simply an |
| their mortgage on time, but have found themselves in | | | | explanation of why you can no longer afford your |
| an adjustable rate mortgage, that has adjusted or is | | | | mortgage payments and why you need to refinance. |
| scheduled to adjust in the near future. Now they have | | | | You want to make these letters simple and to the |
| good credit, good mortgage history, but the problem is | | | | point, no need to write a 50 page essay. |
| they cannot refinance as they owe more than their | | | | The next step is to get pre qualified with an FHA |
| home is worth. Well so they've been told, but one | | | | Lender, the reason FHA Lenders are preferred is |
| insider secret option that is available to home owners | | | | because they will give you the highest LTV possible |
| in this situation is a short refinance. | | | | which will make your offer to your current lender more |
| If the above scenario describes your situation, then | | | | attractive. Once you have the approval you will want |
| your first step towards a short refinance is to contact | | | | to put it with your short refinance package and submit |
| your lenders Loss Mitigation department to see if they | | | | to your lender for approval. |
| would be willing to participate in a short refinance. If | | | | Once the package is received, then your lender will |
| they say NO, then you will want to ask what other | | | | order a BPO (Brokers Price Opinion), this is similar to |
| options are available to you, such as a loan | | | | an appraisal, but is an inspection normally performed by |
| modification, and IF they say yes, then great, you now | | | | a real estate broker in the area to give the lender an |
| need to find a short refinance expert to get the ball | | | | idea of the current market value. Once the BPO is |
| rolling. | | | | reviewed, the lender will give you an offer for the new |
| You will want to find a Mortgage Expert that has | | | | payoff amount. |
| experience with loss mitigation and who specializes in | | | | From here you will want to proceed with you new |
| Short Refinances. This is not time that you want to | | | | FHA Loan, which will require a separate FHA appraisal, |
| just pick any mortgage broker from the yellow pages | | | | hopefully the appraisal will have the same or similar |
| or to let the family friend that is a mortgage broker | | | | value to the BPO, if there is a significant difference, |
| use you as a guinea pig. Short Refinances are a | | | | then your mortgage broker will have to go back to the |
| complicated transaction and require a lot of attention | | | | lender and renegotiate. The ideal situation is to get you |
| and a great deal of knowledge of the loss mitigation | | | | refinanced without having to bring any money to the |
| procedures. | | | | closing table, but in some cased the lenders will not |
| Now to start the process you will need to contact you | | | | bend, and to make the deal work you will have to bring |
| lender and let them know you are considering doing a | | | | some cash to close. |
| short refinance and to send you the short refinance | | | | Once the mutually beneficial agreement has been |
| package. In this package you will have to fill out an | | | | reached, then the lender will issue a release of lien. This |
| application, a personal financial statement that will list all | | | | document will show what the lender will accept as a |
| you income and expenses, 2 months recent bank | | | | net payoff. |
| statements, 2 years tax returns, current paystubs and | | | | |