So, what is this Home Loan Modification?
It is the negotiation with the lender for new terms of your current home mortgage. It could be a change either for the short term, until you get out of the financial struggle, or for the entire period of mortgage repayment. This is mainly done to reduce your financial burden so that potential foreclosure, bankruptcy, etc., can be avoided.
Who qualify for this Loan modification?
If you have lost a job, incurred unexpected medical expenses, or are unable to afford the current payment with your current mortgage then you can qualify. In spite of your best efforts, you may still fall behind on payments. A home loan modification may make all the difference!
Every mortgage institution has their own loan modification standards; however, here is the most common qualification criterion:
If the property is your primary residence and you've experienced financial hardship or a change inyour financial circumstances that has resulted in 2 or 3 missed payments and you are not purposely defaulting to get a loan modification, then you may be eligible for mortgage modification. Also, remember that you should not plan for filing bankruptcy. It is vital that you are willing to be open, honest, and provide all necessary documentation for this process. Even if you have not yet missed a payment, you may still qualify for a mortgage loan modification if you can prove you are "on the edge". Meaning, due to current circumstances, you will eventually default on your loan if you don't get some financial relief. Be truthful with the facts about your current situation.
It is worthwhile to speak with a home loan modification specialist about how to modify your mortgage. You will have better chances of retaining your home when you educate yourself about your options for doing so.