Loan Modifications are where a lender agrees to adjusts the terms of the loan to make it affordable for a homeowner. One of the most common modifications from lenders is the Home Affordable Modification Program (HAMP Modification). In a HAMP Modification, lenders may adjust the interest rate and term of the mortgage to make the total monthly payment equal to a set percentage of a homeowner’s monthly income. Other modifications include “in-house” modifications and the terms of these modifications differ from lender to lender. In most modifications, past due balances and payments are incorporated into the modified loan amount and repaid over time.
Loan modifications can be very beneficial to homeowners, especially those with adjustable rate or interest only loans. For assistance negotiating and completing a loan modification, contact the Law Office of Henry W. Hicks.