When a homeowner is in foreclosure there are a few options available to help stop the foreclosure from going through. One of those options is doing a loan modification. Simply put, a loan modification is an adjustment to the terms of the mortgage loan by the lender.
There are many benefits to doing a loan modification for both the homeowner and the lender. For the homeowner, it will stop the foreclosure and bring the terms to a more manageable level for the homeowner to make their monthly payments. It also saves the homeowner from the severe impact the foreclosure would have on their credit score. In many cases it is more cost effective for the lender to do a loan modification than proceeding with the foreclosure process. By modifying the loan, it saves the lender the time, money, and resources are required to go through the entire foreclosure process. When the homeowner is evicted there are increased costs to the lender to maintain the upkeep of the property and paying any homeowners association fees to keep the property value up. In some cases the property value decreases due to poor upkeep of the property and sometime vandalism by the homeowner before they are evicted.
There are many different types of loan modifications that are available for the homeowner. A few of the more common loan modification types are a forbearance, a loan extension, an interest rate reduction, a loan extension, and a repayment plan.
While in foreclosure, hiring an experienced foreclosure defense attorney to assist you with saving your home is paramount. Having a foreclosure attorney negotiate on your behalf can help assist you with getting better terms for your loan modification or if you do not qualify, find another avenue for you to save your home. For more information on loan modifications and saving your home, visit www.legalhelpgroup.com.