Save your money, try to work with your lender...but do not do the trial mod payments because all of the principal and interest owed will become due and payable the day they decline the modification. Seriously consider a short sale if you, like most, are not successful with getting the bank to work with you.
Do I sound cynical? Absolutely...the entire loan modification program has been a serious waste of tax payer money and the banks are under no obligation to work with any consumer. Wish you the best of luck on your situation.
I was just joking about Fallbrook, it'd be tough to live there if you needed to be in SD or OC every day.
FYI - It is fine and good to get married in Fallbrook and even parts of Fallbrook are really cool and rural (if you like living near chickens and roosters - which I do not) but living here is extremely inconvinient for my husband who owns a security business. It is a real pain to get anywhere from here. Living here adds another 30-40 minutes to his commute into San Diego each way. The cost of gasoline and loss of valuable family time is killing him.
http://www.calhfa.ca.gov/homeownership/programs/30fha.pdf - CalHFA FHA
http://www.calhfa.ca.gov/homeownership/programs/cal30.pdf - CalHFA Conventional
I am so glad you lead me to that thread. I am definitely reconsidering my approach. It looks like we will have to continue to lose money. It makes me sick to my stomach when I think about how much this "investment" is ruining our financial future. I feel like my dreams for my family have been crushed.
"CalHFA story", their book isn't closed yet:
http://ag.ca.gov/loanmod/index.php - tips to keep in mind when trying for a loan modification, including a list of who the AG has sued for illegally providing modification services.
Read about others who have gone through loan modifications - http://www.loansafe.org/forum/ (disclaimer, this website is hosted by a law firm here in California who does loan modifications, but the information & success stories shared among thousands of consumers is still very useful)
There is even a success story I wrote about a client who used the information off of that website to modify their mortgage without even having to go late: http://activerain.com/blogsview/877876/you-don-t-have-to-be- - I do not do loan modifications but I will say I prefer a do-it-yourself approach to most things.
I think with that information you should be able to quickly ascertain if any advice you are getting from law firms who help with loan modifications is valuable or not, rather than taking a chance on $3,500 that this attorney is *the* attorney for the job - who knows, perhaps they are.
Also, the banks do not want to modify your loan, they are receiving bailout money to short sell or foreclose but nothing whatsoever from the government to modify the loan so they are gong to deny the loan mod if they can and collect the money. Sometimes the very fact that a lawyer has been retained can help. But that isn't all that helps, it also helps, if you start the process on your own and it goes badly, to write to your representatives in congress and complain. The thing is this, do you know all your rights under the law? Do you know the penalties if the bank fails to comply with the law?
$3500 is a lot of money. Is the attorney giving you any sort of guarantee? What if he can't get the loan modified? It's a tough call and I don't know as anyone here can help you make the decision. You will just have to weigh the cost versus the benefits and choose.