Why are loan modifications so popular right now?
Many families tried to take advantage of the rising home prices before the recent decline to secure the potentially growing equity with low monthly payments. With the combination of a slumping economy, unemployment rates rising, home prices dropping, and high mortgage interest rates, there are large numbers of families having difficulty making their mortgage payments. Now that prices of homes have dropped, banks want to avoid a financial disaster. Lenders do not want to be stuck with a large number of unoccupied homes that produce no income or repayment of the original loan.
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