Loan modification services offer several benefits. Prior to attempting to understand what makes these services so beneficial, it is important to consider first how loan modification may work to the advantage of an individual who has fallen behind financially and has missed one or more mortgage payments.
Loan modification is simply the act of modifying existing loan terms. This change can be initiated by a mitigation department or by the lender. Loan modification can take place after mortgage payments have been missed, or prior to missed payments. It is best for the home owner to take action as soon as he or she realizes that a payment will be missed.
Borrowers can attempt to negotiate a loan modification on their own. Though this negotiation is possible, professional services are typically the better option. Loan modifying professionals will negotiate on your behalf in an attempt to get the mortgage rate lowered, which will in turn, make the monthly payments lower and more affordable.
Loan modification services are available throughout the U.S. When meeting with one of these professionals be prepared to supply information about your current financial situation. This will help them determine what type of modification to request. All paperwork and negotiations will then be handled by the loan modification service.
The benefits of loan modification include:
- The possibility of a reduced interest rate
- A switch from a variable rate to a fixed rate
- Lengthening of the amount of time allotted for repayment
- Lowering of the entire loan balance
- Protection of your credit rating in the case of foreclosure
- Saving the home from being taken away
While these benefits may seem to only directly benefit the homeowner, there are benefits to the lender as well. Lenders do not desire foreclosure. They make money through lending money, and not through taking homes away from buyers. Lenders want you to pay your mortgage each month, and may be willing to agree to loan modification in order to help you make your payments. Should you fear that foreclosure may be in your future, speak to a qualified loan modification service today.
