How a Loan Modification May Benefit YOU!

With the way the economy is on it’s major down fall, who wouldn’t enjoy less expenses? I mean, I know I would! And I’m sure you guys have heard your neighbors say the words “Loan Modification” at least once or twice then wondered what those two words meant. Well, don’t wonder any longer! Here’s how those two words may benefit YOU!

A loan modification is a change to your loan agreement with your lender. Yes! I said change, and I’m sure we’re all well aware “change is good!”
 
Loan modifications typically involve a reduction in the interest rate on the loan, an extension of the length of the term of the loan, a different type of loan, a reduction of principal or any combination of the four. If you’ve fallen behind in your house payments or even worried about a possible foreclosure, let me advise you, there may be an answer!
 
 As you may have heard before, there are general benefits when modifying your home. Three of the most popular and specific benefits are as follows: You’ll be catching up on payments you may have fallen behind on in the past, there is a reduction of fee’s and penalties and of course, keeping your home while facing possible foreclosure. But, there’s a lot more where that comes from. The benefits of having fewer expenses only add up in the long run.
 
Here are some other reasons YOU should consider modifying your home loan: The reduction in principal, lengthening of the loan term, thus reducing monthly payment amounts, and capping the monthly payment to a 31 percent of house hold income.
 
Although a loan modification may not be the easiest process to follow, it is certainly the worthiest. You’ll be surprised how helpful a loan modification can be to YOU.
Ray Garcia, Esq.
Board Certified in Real Estate Law