Home Loan Mortgage Modification

With millions of people at risk of losing their homes to foreclosure, there is growing interest in home loan mortgage modification, as a possible solution. Unfortunately, unless you’re an expert in finance, it’s easy to find yourself lost in the language unsure what exactly home loan mortgage modification is, and whether or not it’s right for you.

To put it simply, a home loan mortgage modification is when your bank/lender agrees to permanently modify the conditions of an existing homeowner’s loan. Generally, the terms of a home loan mortgage modification are: Lower monthly payments, lower and/or temporarily fixed interest rates, an extension of the loan, or some combination thereof. The goal is to make the payments more affordable, and to prevent the home from entering into foreclosure.

The general rule of thumb is, for a homeowner to obtain a home loan mortgage modification, they must be behind in payments, and have some “documentable” hardship such as: loss of a job, serious illness, reduced income, job relocation, military duty, divorce, inability to sell or rent property, or a death in the family. However, because of Adjustable Rate Mortgages (Option ARM), more, and more people are inquiring about a home loan mortgage modification, as the adjusted rates have made many homes unaffordable for homeowners.

So, is a home loan mortgage modification right for you? Well, that depends. Even with a documentable hardship, there is still no guarantee your lender will grant a home loan mortgage modification. First, as I mentioned, there are literally millions of people at risk of having their homes go into foreclosure, and home loan mortgage modification is the solution many are choosing to pursue. As a result, lenders are being flooded with requests, and those without assistance are often being lost in the shuffle. Also, although having a documentable hardship is very important, the most important requirement for obtaining a home loan mortgage modification, as with all loans, is whether or not you can make the payments. Obviously it’s not in the lender’s best interest to agree to a home loan mortgage modification if you are unable to meet the terms. You can find more info at makinghomeaffordable.gov

A home loan mortgage modification offers millions of people the hope of saving their homes, and if you believe you qualify, you should definitely look into it. However, it is in your best interest to make sure you fully understand the requirements, and that you have all of the information necessary. You only get one chance, and if you’re rejected, you cannot reapply for a home loan mortgage modification.
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