Loan Modification - Your Monthly Budget Done Right

Your monthly budget is a critical component to any mortgage assistance application.

Make sure that the monthly budget conveys the following ideas

• You can not afford the current mortgage payment
• You can afford a mortgage payment if reduced by a reasonable and feasible amount
• You are a responsible Homeowner
  
• You have put time and consideration into your monthly budget and it makes sense

Format of Your Budget

1. List item by item all your expenses and total at the bottom
2. List item by item all your revenue or income and total at the bottom
3. List your total incoming cash minus your total outgoing cash and then highlight the result.

Your result should fall into a range of +- 500 dollars. Ideally you want to have a negative 300 or so dollars month to month although this number tends to vary lender to lender. What you don't want is a budget that conveys "this borrower has plenty of money and no loan modification is necessary" or that "this borrower has no money and no business owning a home".

Thus it is important that you adjust the expenses to a level that avoids to much of a surplus and or to much of a deficit.

If you are a Homeowner who is looking into obtaining a loan modification or need to stop foreclosure then make sure you spend an adequate amount of time in preparation of all submitted materials and applications for assistance. Especially in regards to your monthly budget. Trust me when I tell you that it is indeed reviewed.

Another side note on your monthly budget for a loan modification.

The new Obama foreclosure prevention plan known as the Make Home Affordable Plan calls for a mortgage payment level of about 31% of your take home income. This is just something to keep in mind when preparing your budget.