Mortgage Modification for High Net Worth Individual

As I usually work on mortgage modifications for those having difficulty paying their mortgage, I had the opportunity to assist someone who easily pays their mortgage; and, the experience was quite gratifying.

A very successful person called me. He owns three homes, only one of which is encumbered. It’s a vacation property in New England.

He had a $400,000 mortgage at 6% with 12 years remaining on his initial 15 year mortgage. He noticed that market rates are now lower and was wondering if he could reduce his interest rate, without going through all the paperwork and costs associated with a refinance.

His lender was a small savings bank in New England. The bank was portfolioing the loan – i.e., it had not been sold.

I called the bank and explained who I was and assured the lender that I was not calling to try and modify a loan where their borrower could not pay the mortgage. My client did not want any additional term, merely a reduction in rate. The monthly payment would be debited directly from his checking account.

After an explanation of what I was trying to accomplish, the lender was astute enough to recognize that he did not want his bank to lose the interest it was earning on a performing loan from a very credit worthy borrower. The bank agreed to reduce the interest rate to 5 ¼%, with no other changes to the loan.

My client will save approximately $20,000 over the remaining term of the loan. The cost and time for me to speak “lenderese” to the banker was negligible. A win-win situation for all.

Thank you all for your calls of good wishes for my relationship with Santos, Postal, as well as your referrals! I truly appreciate everyone’s consideration.

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