Forbearance Loan Modification Refinancing Short Sale Deed-Foreclosure

Loan Modification

A loan modification is another good way to stop foreclosure and save your home. A loan modification involves a permanent change in one or more of the terms of your mortgage. The interest rate is one of the terms that can be modified to lower your monthly payment to one that you can better afford. A loan modification is also sometimes called a workout or restructure of the loan.

One advantage of a loan modification to help save your home from foreclosure is that there are usually no closing costs. However, you may have to pay for a new appraisal of your property before your lender will approve a loan modification to stop foreclosure.

Lenders don't like to lower the interest rate and reduce their profit. But, a loan modification is often preferable over a short sale where the lender may end up losing even more money than if they lower your interest rate.