Loan Modification

You know I get this question all of the time… “What is a loan modification?” The way that a loan modification works is exactly how it sounds. First, you need contact your mortgage company and let them know that you are interest in modifying your loan terms.

They will then ask you several questions about your current bills and then plug all of the information that you provide them into their computer. you can expect a call back from your mortgage company regarding your loan modification in as much a 3 weeks.

They will then let you know your new loan terms. For example if you currently have an 8.250% – 5 Year Adjustable Loan then will modify your loan, and the your new terms would be 5.375% – 3 Year Fixed, which as you can see from the drastic reduction in the interest rate would save you a lot of money each and every month.

If you are behind in your payments, they will bulk all late fees and missed payments into the loan once you loan modification is approved. It’s almost like a streamlined refinance without an appraisal.