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Loan Modification on second home

Any idea why Wells Fargo or other lenders don't do a loan modification on a second home (a rental home)? It would seem to me that regardless of the house type (primary, rental, etc.) a lender would prefer to continue to get that fat interest payment even on a lower amount than have to face foreclosure and sell the house for pennies on the dollar.
  • August 28 2009 - Wesley Chapel
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Answers (7)

They will, however, it'll have to be a traditional (In-House) modification since it doesn't qualify for HAMP because it's not owner occupied.
  • February 07 2012
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My second home is serviced by Saxon Mortgage do the have a loan modification program for a Second Home?
  • February 01 2012
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My wife and I are going to file chapter 13 b.k.We own a rental property, we are one month behind on our monthlty payment and it looks like we will not be able to make the following months payment as well.Our mortgage company is One west bank ,previously indy mac bank.We think we can make up the non payments in the chapter 13,would you know if we can also, some how ask for a loan modification on the rental home?. The reason would be more so,  on the side of getting the loan on a fixed program,because it will ajdust for the first time comeing this october 2011.Our primary residence is current,and recently got approved for a loan modification through, now One west bank it's been about 7 months now.
  • May 05 2011
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Wells Fargo does modify rental properties just  not under the Government plan.  A Real Estate Attorney that has experience... knows how to negotiate with a lender can get your loan modified.   Do not let the lender tell you otherwise.  You do not know how many times borrowers that I have seen with my own eyes turn down.... Get approved for a loan modification when they hire a real estate attorney.  Good luck!
  • August 28 2009
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Profile picture for columbiavol
Richmond - My lender is Wells Fargo

Christopher - we cannot sell our house. We are upside down by $61K. Tampa Bay has been one of the hardest hit areas in the nation. In fact, 51% of all homeowners in Tampa Bay are upside down.

We would prefer to keep the house and have it rented out. But investors have come in, scooped up properties for 40 cents on the dollar and undercut the rents by $300-$500 a month. We simply cannot afford to lower the rent $500 a month without some bank help.
  • August 28 2009
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Investment properties will be modified to a break even level or just under so you have some cash to repair or maintain the property. Investment properties must also be late to get action- if your still paying them, there is no need to change the terms.

They are not going to forgive your balance because the housing market has taken a dive- they are the BANK!! They are in it for the money- they do not care about your best interest. Its a dollar game as you probably already know.

Typical results for investment properties are between 5-7% PI payment. If you are already at an interest rate around these levels, you may want to consider selling the home. They will not take you down below these levels. Also, they could have bought your property for  40 cents on the dollar, so if they sell it at 50 cents on the dollar, they will turn a profit. It really depends on the investor guidelines and what they see is a profitable move.

Maybe look into getting a forensic audit. If there is a violation, you may be entitled for a balance reduction and modification- Best of Luck
  • August 28 2009
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In many cases banks will do a modification on a second home as long as you meet the criteria. The making homes affordable option is not available but many banks do have an array of other options. If you provide your lenders name I can direct you to the correct section of their website.
  • August 28 2009
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