Loan Modification

What is a loan modification?

Loan modification is a term that is brought up quite often, but many people don't understand exactly what it is and to whom it is available for. Basically, a loan modification is a restructuring of your current home loan to make the monthly payments fit within the parameters of your budget. Generally the homeowner applies for the modification through their current lender to check if they qualify, and if the modification is approved then the homeowner will start a trial period where they make monthly payments in the new amount for a few months as dictated by the lender. Finally, if all goes smoothly, the homeowner signs the loan finalization documents to make the new payment plan permanent.

It is important to know that not everyone qualifies for a modification. Qualification varies greatly, depending on household income, debt ratio and other bank-specific requirements. When the homeowner is approved for a loan modification it creates a new agreement and eliminates the foreclosure suit.

Is it necessary to use an attorney for a loan modification?

Many attorneys that handle foreclosure cases don't process modifications. Partially because an outcome cannot be guaranteed and it is very time consuming. Homeowners can complete the loan modification process on their own, though it is a tedious and often intimidating process. At Foreclosure Defense LLC., we have focused all of our energy on learning everything about foreclosure suits, including filing loan modifications for our clients. Thus we are prepared to submit all of the correct documents to the bank, we know when and how often to follow-up with the lender to prevent any lags in the process, we also have the skills to review a loan modification proposal and advise clients if it is a worthwhile offer.

Given that we have processed an insurmountable number of modifications for our clients, with all mortgage lenders, we know exactly what the bank needs in order to process your application. Furthermore, we stay one step ahead of the bank and we know their tricks, thus we can navigate the loan modification process better than a homeowner who chooses to do it alone. When there is a foreclosure defense attorney involved in the suit, the bank knows that the homeowner has a much higher probability of obtaining a judgment in their favor and it encourages them to work towards a resolution of the case.