The Wachovia loan modification program has been primarily put in place in order to prevent the high rate of loan default that is happening with their loans. Most people are finding the adjustable rate loans of Wachovia difficult to pay after some time, especially the loan program that is titled as 'Pick a Payment'.
Why does Wachovia allow Loan Modification?
There are two main intentions of the Wachovia loan modification program. These include:-
* Allowing adjustable rate loan holders to become fixed rate holders so that they can manage their expenses properly.
* Removing negative amortization type loans which do not pay out the due interest in the early stages due to which the balances become unaffordable after a few years.
Eligibility for a Wachovia Loan Modification
So, if you are holding a Wachovia Bank mortgage for your home, it might be easier for you to convert it to simpler and better paying terms than you think. However, there are some qualifications that are needed so that you become eligible for getting these loan modification programs. These qualifications include:-
* The home whose mortgage you are trying to modify must be your primary home. You should be living in that home.
* The modification program is applicable only if the home is a single family home or is a condominium. Loan modifications are not allowed if more units are staying within the home.
* There should be at least a 45% debt ratio for the modification program to become available to you. What this means is that the payment of the loan should cover at least 45% of your total monthly income. If it goes beyond this level, then it is federally considered that the loan is unaffordable to you and a modification will become a possibility.
An Example of a Wachovia Loan Modification Program
Wachovia loan modification works in a stepwise manner. The rate is adjusted according to the years for which that the loan modification has been implemented. In the first year, a 2% note rate will be applied, which will increase to 4% in the second year. Options such as amortizing missed payments are available.
The thing to remember is that they are actually working with borrowers to make the loans more affordable for the homeowners so that they do not default on it. If you have a loan that has become extremely difficult for you, it would be in your best interest to take a look at this option.
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