In today’s erratic housing market, many homeowners are finding themselves saddled with mortgages they simply can no longer afford. If you find yourself in a situation in which your mortgage payment is threatening your livelihood, it is good to know that you have options. Consulting with a foreclosure attorney is always a great step, whether or not you are faced with the threat of foreclosure, as the foreclosure attorney will offer guidance and possible alternatives. Many people are able to perform some sort of mortgage modification and ease the burden on their pocketbooks.
Types of Mortgage Modifications
There are several types of mortgage modification that are common today. These include:
● Interest rate reductions, either temporary or permanent
● Extension of the loan period
● Deferral of the loan principal
It is rare that the lender will ever forgive a portion of the principal, even in cases of underwater mortgages, in which the home has lost value since the loan was brokered. Understandably, companies wish to recover the money they have lent. Often, however, companies are willing to negotiate the terms in favor of the borrower, if the borrower demonstrates financial hardship and a willingness to pay. For this reason, even if you cannot make payments in full, it’s important to always make at least partial monthly payments and demonstrate good faith. A lender will be more willing to work with a borrower they perceive as honest and unfortunate, rather than one they see as a deadbeat. Consult your foreclosure attorney to determine what kind of mortgage modification you may qualify for, and you will be on your way out of financial distress.