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5 steps to a successful loan modification

Get financially literate
Get financially literate

Housing counselors have empathy for clients. But there is an undercurrent of frustration, too.

"The key to this process is they need some kind of financial literacy training," Jones says. "Yes, we get a workout, but counseling should not stop there."

Borrowers need financial coaching, with frequent checkups, Jones says. ESOP surveys its mortgage-workout clients at three months, six months and one year afterward, "just to see if they're staying on track," Jones says.

"And you'll be surprised at what we call 'frequent fliers,'" Jones says. "We get them out of trouble and the next thing you know, here they come again."

Financial literacy, Jones says, is the key to "changing that frame of mind that says, 'I see it, I want it, and I can get it, so I'm going to get it.' That whole idea has to change."

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