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What Is A Loan Modification?

Florida Loan Modification Attorney

For some homeowners, a loan modification is the best way for a homeowner to keep his home if he is behind on the mortgage payments. Through a loan modification, the homeowner may be able to negotiate loan terms that are more favorable and allow the owner to afford the mortgage payments.

However, the loan modification process in Florida is not always easy. You need a Daytona real estate attorney to help you negotiate the terms of the loan modification so that you achieve your goal of keeping your home and preventing foreclosure.

If you are facing foreclosure or you are behind on your mortgage payments, contact our law firm by calling (888) 316-2131 to discuss how our Daytona loan modification attorney can help you keep your home.

What is a Loan Modification Agreement?

A loan modification agreement is different from a forbearance agreement or a refinance. With a forbearance agreement, the lender agrees to temporarily suspend the mortgage payments or temporarily reduce the mortgage payments because you suffered a financial hardship. Forbearance agreements do not change the terms of the loan and are only good when the financial hardship is short-term, and you can recover quickly after the crisis is over.

A mortgage refinance is a brand new loan and mortgage. You must apply with a lender for a new loan that will pay off your existing mortgage. If you are approved for the refinance, the new loan proceeds are used to pay the current loan in full. The new mortgage then becomes the first lien on your property. In many cases, if you are behind on your mortgage payments or a foreclosure lawsuit has been filed, a refinance of your existing mortgage may not be a possible solution.

With a loan modification, you change the terms of your current mortgage permanently. The agreement with the lender may lower the interest rate, extend the term of the loan, or include forgiveness of debt for a portion of the principal amount of the loan.

The loan modification is intended to lower your monthly mortgage payment so that you can resume making payments to the lender to avoid foreclosure and keep your home. In some cases, a lender may add the past due payments to the end of the mortgage and extend the term of the mortgage. In other cases, a lender may “forgive” the past due payments to keep your loan payment low and affordable.

Why Does a Lender Agree to a Loan Modification?

When a lender can foreclose on its mortgage and sell the property, why would it agree to a loan modification agreement? Lenders are not in the business of owning real estate. When a lender forecloses a home and takes title to the home, it must retain the services of a real estate agent or property management company to maintain the property until it can be sold.

Hiring professionals to help maintain and sell the home can be expensive. In addition, the lender may not receive enough money to pay the loan in full. Therefore, it is losing money each day it owns the property and is paying someone to manage and list the property for sale.

Therefore, even if you are not behind on your mortgage payments yet, or a foreclosure lawsuit has not been filed, a lender may agree to a loan modification agreement. By agreeing to the loan modification, the lender does not need to pay a foreclosure attorney, real estate agent, management company, and other professionals to take your home and sell it through foreclosure.

Do I Need a Daytona Loan Modification Attorney?

You can attempt to negotiate the loan modification directly with your lender. However, it can be difficult to complete a successful loan modification application without assistance. By retaining an experienced loan modification lawyer in Daytona, you have the benefit of experience and knowledge on your side as you approach your mortgage lender to request a loan modification.

Many homeowners become frustrated with the process because the lender continually requests updated information and additional documentation to process the request for a loan modification. If you do not provide all documentation and information with your initial application, the process could take much longer and become much more stressful and annoying. By hiring a Daytona loan modification attorney, you have a staff of legal professionals handling your loan modification application, so you can trust that the application will be complete and correct the first time.

Our team of legal professionals understands the loan modification process. We stand up to mortgage lenders and mortgage servicers to demand that they treat you fairly in the process of restructuring your loan through a modification.

Call a Daytona Loan Modification Attorney for More Information

Because we are also experienced bankruptcy attorneys, we can explain a variety of solutions that can get you out of debt and allow you to keep your home. Loan modification and a Chapter 13 bankruptcy are just two of the legal options you may have for saving your home.

Call (888) 316-2131 to discuss how our Daytona real estate lawyer can help you apply for a loan modification.

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