Posted On: November 5, 2010

What is a Loan Modification

A Sacramento bankruptcy attorney explains loan modifications in detail.

Homeowners who find themselves in default may find that they can renegotiate the loan payment terms with his bank. If a mortgage holder does not understand exactly what the term means, he may get in some trouble negotiating the terms. Many people who do modify their home loans still find it difficult to make their monthly payments.

What Is Loan Modification?
A loan modification program allows a lender and a debtor to enter into an agreement to later the original terms of the loan. Current events have made the phrase part of the common lexicon, but any loan held by a bank can be modified as long as both parties agree to the terms.

Is There a Standard Structure?
The mortgage modification programs offer by the federal program usually let people make payments on only the balance of their mortgage. Interest payments get added to the end of the life of the loan. Such modifications are designed to give a person enough time to stabilize his financial situation.

When Should I Do This?
A borrower wants to avoid loan modification programs if they occur because he has problems making payments. A person can make arrangements to pay the loan off earlier, which may include renegotiating any early pay off penalties that he may incur.

If you would like more information on this topic or other bankruptcy topics, please contact our Sacramento office at 916.792.6025 or . We at Bankruptcy Law Firm can connect you with one our our experienced Sacramento bankruptcy attorneys. We have bankruptcy attorneys located throughout California and Oregon to assist you with your bankruptcy questions. If you need assistance regarding a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, a cram down, stopping a foreclosure or wage garnishment, asset protection, discharging debt, etc. we can help! Please contact us to receive a free consultation or visit our website at www.sagarialaw.com to request an in-person consultation with an experienced bankruptcy attorney. We have an exceptional team of bankruptcy lawyers, bankruptcy client care specialists and bankruptcy staff supporting Sacramento.

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