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debt resolution, loan modification, mortgage modification, nj loan modification

My NJ Mortgage Modification was Denied but I Don't Know Why

Time is everything when you are behind on your mortgage. We've compiled a list of reasons your NJ mortgage modification could be denied—and how to make sure it gets accepted.

On Behalf of Veitengruber Law | Apr 18,2022

Applying for a loan modification takes time and requires a lot of paperwork. The time-consuming nature of the application process often means homeowners fall even further behind in paying their bills. When these homeowners find their loan modification rejected, they can be so far behind in payments that they need to consider other options, like bankruptcy, to solve their financial problems. Time is everything when you are behind on your mortgage. To save time and frustration, here are some reasons your NJ mortgage modification could be denied—and how to ensure it gets accepted.

Some common reasons your loan modification was denied can include:

  • Your application was incomplete or not submitted on time.
  • You do not have the finances for a modified payment.
  • You have not provided sufficient proof of hardship.
  • You have received the maximum number of loan modifications.
  • You previously missed a trial loan modification payment.
  • You were unable to make a year's worth of consecutive payments on the original loan or previous modification.

Another common reason for denial of a loan modification has absolutely nothing to do with the application. Sometimes the mortgage servicer denies a modification in error or in violation. There are specific federal laws in place to protect homeowners’ rights from fraudulent denials of loan modifications. Lenders and loan servicers must go through a set process to review and accept or deny loan modifications. Failure to go through this process is against the law.

These are some common ways mortgage servicers can violate the law to deny your modification:

  • Taking longer than 30 days to provide requested loan information
  • Failing to contact the borrower within five days of receiving the application if more information is needed
  • Dual Tracking: This means filing for foreclosure, scheduling a Sheriff’s sale, or filing a final judgment anytime during the review process of the loan modification application.
  • Taking longer than 30 days to provide a decision on the application
  • Falsely informing the borrower that they need to be in default to apply for a modification

If you have been denied a loan modification—or told you don’t even qualify for one—we can help. Veitengruber Law can review your loan modification application to determine if your lender wrongfully denied it or where we can make changes to get it approved. If you are thinking of filing for a mortgage modification, we can assist you from the beginning to ensure your lender sticks within the law, giving you your best shot at modification approval.

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