For many homeowners hit hard by the recession, falling behind on their mortgage has become like paddling water out of a sinking ship. However, for many Florida homeowners, the ability to secure a loan modification may be the one tool that can help struggling homeowners stay in their homes. Unfortunately, the process of obtaining a loan modification can be complicated, cumbersome and impossible for some. New standards of practice may soon help make the process smoother.

An investigation into some of the largest banks in the United States found that many homeowners in the process of seeking of a loan modification were wrongfully thrust into the foreclosure process. The largest banks involved in the wrongful practice were actually ordered to pay fines of $25 billion. However, the problems still persisted. 

The essence of the problem with the loan modification essentially boiled down to paperwork that was held up for long periods of time. The abundance of forms and disputes over the “completeness” of a loan modification would result in people losing their homes while waiting for approval for the one thing that would help them keep their homes. Simplified versions and standard forms are now being employed to help homeowners meet application deadlines and get the ball rolling toward getting the loan modification they need.

While a loan modification may seem to be complicated and time consuming, having help and explanations available can help homeowners apply and seek approval faster. The more knowledge a Florida homeowner has about the process, the more informed of a decision they may be able to make. Loan modifications can work to help homeowners and simplifying the process can expand that help to many more.

Source: Source: prospect.org, “Murky Language Puts Homes Underwater,” David Dayen, July 2, 2013