What is home loan modification?
Loan modification comes in many flavors taking into account your personal financial situation, payment history, overall debt load, earnings and the current value of the home. It also depends on if the property is your primary residence, a second home or an investment property. At this time, most loan modifications are for primary residence properties only. Under loan modification, the financial terms of the loan – typically the interest payment – are modified in the short-term to assist the homeowner in making payments and then “stepping up” to a more conventional loan over time. The lender may offer modification similar to the following: • Year 1 – 1% interest only • Year 2 – 2% interest + principal • Year 3 – 3% interest + principal • Year 4-30 – 5.75% interest + principal Again, the above is only an example of what a loan modification may look like. There are many outfits offering loan modifications and some are scams, others are not. In general, working directly with your lender co
