Looking For A Debt Solution? 5 Reasons To Hire A Loan Modification Lawyer

• 26 May 2018
• News

A loan modification is nothing but a permanent redoing of a mortgage agreement. It is when one or more of the terms of a loan are changed in order to provide a more affordable payment. The lender may agree to take one or more actions to reduce your monthly payment. In addition, a loan modification attorney can help you throughout this process.

Examples of things the lender may agree to is reducing the interest rate, converting the loan from a variable interest rate to a fixed interest rate or extending the length of the term of the loan.

Helps determines the best course of action

Documentation that is necessary for a loan modification is a financial statement, recent tax returns, proof of income, bank statements and a hardship statement. There are at least five reasons to hire a loan modification lawyer; one reason is that it helps to determine the best course of action. Another reason is that it lessens anxiety and stress.

Helps you deduce a lower monthly payment

Most importantly, a loan modification may prevent duel tracking. Duel tracking is when lenders continue with a foreclosure while the modification application is still in the wings. The loan modification process also helps to secure lower monthly payments. Talk with a Loan modification lawyer soon and find out how he or she can help you.

Avoid the foreclosure process

Keep in mind; there are advantages and disadvantages of a loan modification. Perhaps the most treasured advantage of a loan modification is that the homeowner is able to remain in their home. In addition, the lender also has the advantage of not having to go through the foreclosure process. This is especially good for the lender, as well as the borrower, because the borrower may be going through a brief hardship and will soon be able to resume making payments on time.

Lower interest, secured finances

Another advantage for the borrower is that the interest rate is often lower. Reducing the interest rate on a mortgage can be immensely beneficial because it will help get them through a financial crisis. Most importantly, a loan modification can help the borrower take care of other pressing financial needs such as an auto loan, student loan or credit card payments.

Learn the possible challenges and disadvantages

Though, you must be well aware that a loan modification can impact one’s credit score. Also, there are processing costs and legal fees that the borrower will have to pay. Most importantly, if the lender reduces the principal of the loan, the borrower may have to pay income taxes on it. Also, if the lender is doubtful that the borrower will continue to make payments on the long haul, the lender may encourage the borrower to sell their property. All these issues can be solved prior to their course with the help of an experienced loan modification lawyer who can foresee all your possible options and give you a guided solutions towards not just keeping your finances secure but foreseeing and preparing for any further challenges that may arise.

Conclusion

When modifying your mortgage, it is essential to get expert help and stay safe. Your loan modification lawyer, for a smooth loan modification process will advice you to to gather together certain documents like recent bank statements, tax returns and stubs. Check to see if you qualify for the federal government’s Home Affordable Modification Program and explore different options such as extending your home loan and consult with an expert loan modification lawyer today.