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How Does A Loan Modification Work?

A loan modification is a response to a borrower's long-term inability to repay the loan. Loan modifications typically involve a reduction in the principal balance, interest rate or an extension of the length of the term of the loan. In some cases a different type of loan or any combination of the three. A lender might be open to modifying a loan because the cost of doing so is less than the cost of default or foreclosure.

 

A loan modification agreement is different from a forbearance agreement. A forbearance agreement provides short-term relief for borrowers who have temporary financial problems, while a loan modification agreement is a long-term solution for borrowers who will never be able to repay an existing loan.

 

Loan modification is a relatively new term to most homeowners. What most people are coming to realize is that losing their house to foreclosure is becoming a real possibility. Home foreclosure in America today is at an all time high and is affecting many homeowners that never believed they could lose their home to foreclosure. Homeowners are feeling the crunch of higher interest rates and a slowing economy. A loan modification may be the only way for a homeowner to save the biggest investment of their life; their home.

 

Negotiating with the bank for a modification of your home loan can be an overwhelming process for many homeowners. That is why retaining the services of an experienced loan modification company is of extreme importance.

 

The reality of today's market is one of steep drops in real estate values nationwide coupled with tighter credit requirements. The combination of the two makes a formidable opponent for someone facing an upcoming adjustment in their payments due to an adjustable rate mortgage (ARM). It's not a good idea to take on your lender alone.

 

Close Your Own Loan.com can help to bring your mortgage lender to reasonable terms that make sense in today's volatile economy. We will fight to save your home and get you a payment you can afford. 

 

Get help now.  Speak with a Mortgage Loan Modification Specialist at 1-800-276-2965 and select option 1 or click here for your free no obligation consultation.