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How Can A Loan Modification Help Homeowners?

loan modification helpEvery day in the news you hear about homes going into foreclosure in record numbers.  Job loss, too much debt and a long list of other circumstances are causing thousands and thousands of homeowners to lose their homes everyday.

If you are a homeowner having a difficult time financially and fear you may eventually lose your home to foreclosure …there are options you can consider before it’s too late.

One option that millions of homeowners have used successfully is called a loan modification.  It could be the answer to help you keep your home too.

So first let’s look at what a loan modification does.

A loan modification is where the lender allows a homeowner to lower their monthly mortgage payment.  This can be achieved in a few different ways.

 

1.) Your lender can lower your interest rate.
2.) The term of your loan can be extended.
3.)Your principal balance is reduced.
4.) You may also be given a different loan or a lender can combine any of these.

Now let’s see how each of the above helps in more detail.

How Can A Loan Modification Help Homeowners?

Here’s a  common scenario with many homeowners  who eventually lose their homes.

The original monthly payment was manageable and mortgage payments were made with no problem.  Then over the course of the loan the interest rate increases. Unfortunately, in many cases salaries do not increase at the same rate.  Then there are other household bills that must be paid. Including medical expenses not covered by insurance.  At some point in time, the ability to make the monthly mortgage payments becomes more and more difficult.  Eventually, a homeowner stops making the payments completely.

To help a homeowner in this situation, a loan modification that reduces their current interest rate lowers the monthly mortgage payment can be used by their lender.

Here’s another example of how a loan modification helps homeowners.

If you have for instance a 30 year mortgage.  You can negotiate a loan modification to extend the length of your loan to a 40 year loan.  Now you have more time and a lower payment, since you are paying off your mortgage in 10 more years than before.

Finally, if you need more help than these solutions can offer, you can negotiate for a combination of these terms with your lender. For example you may need both an extension on the length of your loan and a reduced interest rate in order to pay your mortgage.

There are alternate loan help options available as well. It all depends on your specific situation.

Whether or not any of these scenarios describes your current situation, if you are struggling for any reason with trying to pay your mortgage…you have to take steps now to secure your home and work towards creating a healthier financial future.

Call 888-766-3693 if you have any questions about modifying your loan.  You can also visit Loan Modification Company Reviews to read about companies who can help.

It can be an overwhelming and stressful time in your life. But you can make the choice right now to take steps to turn things around. You worked hard to buy your home, it is a symbol of accomplishment and pride.  You have options to explore.

Are You Ready To Take The Next Step?

You now know more about loan modifications and how they can help you.  Next is to learn the “Steps To Take When Applying For A Loan Modification.”


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