What is a Mortgage Modification?
Mortgage modification is a technique which is used to make a mortgage loan more manageable for someone who is struggling to keep up with the mortgage payments. It involves a permanent change to one or more of the terms of the loan which allows a borrower to stay in his or her home and keep up on the loan, rather than forfeiting the home to foreclosure or short sale proceedings. This option is generally only available to borrowers who are in serious financial trouble, rather than to people who simply want to refinance a mortgage to get better terms. In a mortgage modification, the borrower works with the lender to arrive at new terms which will satisfy both parties. An attorney or mortgage broker may work with the borrower to smooth the proceedings, and to make sure that the borrower is fairly represented. Borrowers who are not familiar with the financial world can often benefit from an attorney or financial adviser who can ensure that the mortgage modification results in a loan which w
If you are unable to make your mortgage payments or are very strained financially when doing so, and your home has declined in value, you are a possible candidate for a mortgage modification. In a mortgage modification, we negotiate on your behalf to reach an agreement with your mortgage company to change the terms of your mortgage to benefit you. The new terms generally are a more accurate reflection of the current situation and make the mortgage more affordable so you can continue owning your home. However, mortgage companies may be reluctant to deal with your situation if you have ignored them, failed to return calls, left mail unattended to, and generally demonstrated a lack of interest in your situation. Their assumption is that you cannot be counted on as a partner in your mortgage. So, if you have been ignoring your mortgage company, don’t expect them to be very enthusiastic about trying to give you some concessions to help you solve your issue. They may show the same disinteres
A home loan modification, granted only upon the existing lender’s approval, permanently reworks some of the terms of an existing mortgage in order to make the loan more affordable to the homeowner. The strategy is typically designed for homeowners struggling to pay their mortgage, not for those who can pay their mortgage or are eligible for a refinanced loan. Modifications are generally lender fee-free and involve the lender or loan holder lowering the interest rate and or changing an adjustable-rate mortgage (ARM) to a fixed rate mortgage (FRM) with a 30-year term. Some form of mandated homeownership counseling generally comes with the deal. Less common loan modifications include adding missed payments to the loan balance and extending the term of the loan. Least common is getting the lender to reduce the principal or wipe out any second mortgages. A mortgage modification is not a refinanced mortgage — a brand new loan written to pay off the old home loan. “A mortgage is one of the m
A home loan modification, granted only upon the existing lender’s approval, permanently reworks some of the terms of an existing mortgage in order to make the loan more affordable to the homeowner. The strategy is typically designed for homeowners struggling to pay their mortgage, not for those who can pay their mortgage or are eligible for a refinanced loan. Modifications are generally lender fee-free and involve the lender or loan holder lowering the interest rate and or changing an adjustable-rate mortgage (ARM) to a fixed rate mortgage (FRM) with a 30-year term. Some form of mandated homeownership counseling generally comes with the deal. Less common loan modifications include adding missed payments to the loan balance and extending the term of the loan. Least common is getting the lender to reduce the principal or wipe out any second mortgages. A mortgage modification is not a refinanced mortgage – a brand new loan written to pay off the old home loan. A mortgage is one of the mos
