WHAT THEY DO AND HOW THEY WORK

A loan modification is essentially an agreement between you and the bank to change the terms of your mortgage so that you're paying over a longer term, say 30 to 40 years, or you're lowering the interest rate, or a combination of both.  While the lowering of principal is something that CAN happen, it's very rare, so we don't often mention that when talking about modifications.  The typical modification lowers the ongoing mortgage payment, takes the arrears or amount you are behind and places it into the loan principal, and you pay it over another 30 years.  

THE GOOD: A lower mortgage payment

In most cases, stretching out the loan another 30 to 40 years can drop the mortgage payment, and if you're struggling putting food on the table, that can help immensely with taking care of yourself or your family. 

THE BAD(?): A new loan

A loan modification is essentially a new loan, so it may take a LOT longer to pay off your house.  Of course, if your'e planning to sell the home at some point, this shouldn't matter.

THE GOOD: Lower interest rates

Interest rate reduction or the transformation from a variable to a fixed interest rate is something you can bet on when you're doing a modification.  This can translate into a lower payment for the course of the mortgage.

THE UGLY: Banks can be deceptive

Doing a loan modification on your own can be daunting to say the least. Oftentimes, mortgage banks claim to 'lose' your documentation, or simply deny receiving it, giving you the runaround.  Our loan modification attorneys can make sure that there's a paper trail and applications are filled out correctly and all documentation is provided.

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