What is a loan modification program and how does it benefit you?

Loan modification program is a process by which you can negotiate with your lenders for a revised terms and conditions on your mortgage loan. You can negotiate with your mortgage lender to reduce the interest rate on your loan; you may also request to extend the loan repayment term. The primary purpose of loan modification program is to make your payments affordable so that you can stay current on your mortgage.

What are the eligibility criteria for loan modification program?

You need to satisfy the following eligibility criteria in order to qualify for a loan modification program.

• Your mortgaged property is your primary residence.
• You have suffered financial hardship; such as, sudden job loss or unexpected medical expenses.
• You have not filed bankruptcy.
• You want to work with your mortgage lender for an alternative home loan repaying option.
• You have defaulted on your mortgage payments for a minimum of 3 consecutive months.

Your lender will verify whether or not you have purposely defaulted on your loan. Usually lenders also consider the equity in the property in order to approve a loan modification program.

What are the benefits of a loan modification program?

Loan modification program offers you a number of benefits, whish are listed below.

• It will help you to reduce the interest rates on your monthly mortgage payments.
• You can get current on your mortgage loan.
• If you wish, you can extend your mortgage loan term.
• You are able to convert your adjustable rate mortgage to a fixed rate mortgage loan.
• You can include your past due payments on your mortgage loan.

If you want you can contact a loss mitigation specialist, who can negotiate with your mortgage lender, on your behalf. However, if you take professional help, then you will have to pay a certain fee for your loan modification program.