What Is A Loan Modification?

A loan modification will change your client's existing mortgage note and give them a fresh start. Their account will be brought up to date as soon as the terms of the modification are negotiated. A lender may negotiate existing loans by some or all of the following: reducing interest rates, extending the length of the loan, lowering the principal balance, reducing the amount of accrued back payments or late fees as well as many other options.

A loan modification takes anywhere from 30 to 90 days, and consists of the following process:

•Preparation of a comprehensive application for their lender.
•Detailed Financials to include all income, assets, tax returns and all monthly expenses
•Letter of hardship
•Cost & Benefit Analysis
•Financial Analysis
•Negotiations with their existing lender and/or their attorneys

What is a Hardship?

A hardship is a situation that has a life changing effect for the homeowner that results in an inability to pay the mortgage debt in either, short or long term. A lender will also what to know that the homeowner has recovered from this hardship and can still afford the home.

Some examples are:
•Separation or Divorce
•Medical Bills
•Inability to Work Due to Health Reasons
•Death of Spouse
•Job Relocation
•Reduced Income or Unemployment
•Business Failure