I have a former co-worker of mine who just shared her story with me about her loan that was modified. I have talked to many people about loan modifications and it seems that they “know someone who knows someone” who got their principal cut or rate lowered by an amazing amount. I heard this story first hand and thought I should share it with everyone that I know. I think we all know people who are in a similar situation with an adjustable rate mortgage…

Here is her story:

• loan is with Citibank, was an interest only loan that would adjust in 2011
• stopped making payments in November 2008
• wrote a letter about her situation as soon as she stopped making payments
• sent in the paperwork they requested
• kept calling and made notes every time she called. Talked to people in Loss Mitigation Department

How the lender modified her loan (after 8 months):

• tacked on missed payments to the end of loan
• adjusted mortgage from 30 year to 40 year
• changed interest rate to 2.875 for first year, 3.875 for second year, and 4.875 for 3rd year and beyond

With this said, she did not get her principal reduced but, she is now in a payment that she can afford. She did not have to pay a loan modification company but did have to have patience and determination. She is no longer worrying about her loan adjusting. She mentioned to me that it helped that she did everything in writing instead of just calling the bank.

I hope this gives some of you hope .