Home Loan Modification Mortgage Modification Mortgage Repayment

The loan modification process is for homeowners who are having trouble with making their loan payment. Quite frequently these homeowners will be able to acquire a loan modification that can provide extended loan repayment terms for up to 40 years with a reduced interest rate. Borrowers who are delinquent on their loan payments and are facing financial hardship have a few options that are discussed below.

Arrange A Repayment Plan

If you are struggling financially because of unemployment or a temporary financial hardship this option will help you come current on you loan repayments. This plan will allow you to make up missed payments by working with lenders and paying a certain percentage of the past due amount each month in addition to your normal payment. Often times you will be able to repay the missed payments and can avoid foreclosure.

FHA Loan-Partial Claim

This is issued by FHA insurance to pay the default amount and get your loan out of the red. You will have to sign a promissory note for the defaulted amount, however, no interest or payments are due on this loan until the house is sold or refinanced. The only condition is that you must be a minimum of 4 months behind on payments but no more than 12 months total.

Mortgage Modification

You may qualify for this option however, you have to produce and complete certain documents to prove incurred hardships and support your request for a loan modification. Homeowners are required to submit an application to bank or a financial institution which will be reviewed by the bank before a viable option is settled on. You must provide documentation that confirms your current financial situation.

Here is a quick list of commonly needed documents for the process:

Bank statements

W2 Tax returns

Wage and earning statements

Hardship letter describing the events which caused the financial difficulty