JPMorgan Chase is now the largest bank in the US, surpassing Bank of America, based on its total assets. With the merger of Chase and Washington Mutual, Chase holds a huge percentage of home loans resulting from the real estate boom of the last decade. In addition to Washington Mutual, Chase also owns EMC, another mortgage lender with a large portfolio of mortgage loans. As a result, Chase has one of the largest home retention departments resulting from bad economic times and the fall in real estate values. While Chase can be one of the slower banks in providing loan modifications, they are beginning to improve their process and offer quality modifications. (continued below)
I recently received a modification for a client in Riverside County who had a mortgage through Chase (formerly Washington Mutual). The client was self-employed in construction with varying income through the year. At the time of the modification, the client owed a principal balance of $190,000 and under the original loan was required to make monthly payments of $1,400. Under the revised loan, the clients new payment was $710/mo. including principal, interest, taxes, and insurance. This payment will be due over the remaining 25 year term left on the loan.
While the discounted payment is impressive, the best part of this modification is that Chase has also agreed to reduce the principal balance. Under the terms of the modification, if the client is current on mortgage payments on the first, second, and third anniversary of his first payment, the bank will reduce the balance by a total of $124,000. As a result, the balance owed on the loan after the third year will be approximately $66,000. Under the modification the client has obtained an affordable loan payment, will save hundreds of thousands on the loan, and will owe close to what the home is worth without waiting for the market to correct.
JP Morgan Chase Bank Loan Modification:
Principal Balance: $190,000
Monthly Payment Before Modification: $1,400
Principal Balance After 3 Years: $65,000
Monthly Payment Under Modification: $710/mo.
Total Savings: $125,000
If you or someone you know is considering their options for a loan modification, contact our office for a free analysis of your options by calling (877) 346-7411. You may be a good candidate for principal reduction or having your interest rate and mortgage payment reduced. De Novo Law Firm specializes in bankruptcy, loan modification, and real estate litigation in Riverside, San Bernardino, Moreno Valley, Hemet, Perris, Menifee, Murrietta, Temecula, Rancho Cucamonga and the entire Inland Empire.