Commercial property owners seeking a Wachovia loan modification may notice that the process isn’t as easy as it should be. Since the federal government offers no loan modification programs aimed at commercial real estate, commercial real estate owners have only one option to seek a modification, go directly through their lender and hope to get approved.
Usually when a loan modification of a business property becomes necessary, it is due to an underperforming business or the inability of the property owner to fill their property with businesses able to pay their rent in full or on time.
Several factors affect the likelihood of being approved for a loan modification, including the borrower’s ability to make their lower monthly payments, the value of the collateral against the loan, the amount to be repaid, and the amount of the loan that is in default. Borrowers should realize, however, that even though their property meets all of the requirements necessary to be approved for a Wachovia loan modification, it does not guarantee that Wachovia will grant the modification.
The decision to modify a loan rests entirely with the lender, which is why a skilled negotiator is necessary to speak on behalf of the borrower. The best negotiators are experienced foreclosure attorneys, since they have a great deal of experience in dealing with lenders and they are able to tell the difference between a good deal and a bad one. Those negotiating skills will also extend into the court room should the case go into litigation.
One tactic that is often successful in getting a lender like Wachovia to modify a loan is the collection of evidence to show that certain predatory lending practices were used and included in the mortgage contract at the time it was originally signed that may have led to the borrower’s inability to pay. Gathering this kind of evidence is easy for experienced attorneys and it is a job that borrowers should leave to the attorneys handling their case to avoid errors or the overlooking of important pieces of evidence. If the lender can be shown that their practices were illegal at the time the original mortgage contract was drafted, they may be more willing to negotiate a modification out of court rather than have the facts of their predatory lending practices made known to the public.
When a commercial property owner decides to pursue a Wachovia loan modification, he or she should begin compiling the necessary documents as soon as possible. Those documents will include the lender’s loan modification application, copies of past tax returns, profit and loss statements, a hardship letter outlining the problem that led to the inability to pay, and any other documents requested by the lender. The documents that each lender requires will differ slightly from lender to lender, but the purpose of the documents will remain the same. The documents are reviewed by the lender to ensure the borrower is someone who is actually in need of a modification, not just someone who wants lower monthly payments.