When you have financial trouble, one of your first concerns may be your mortgage. The last thing you want is for it to go into foreclosure and to lose your family home. Your lender also wants to avoid this, so it may offer you a solution called a loan modification. This option is a great way for Florida homeowners to save their homes and get back on track financially.
According to NerdWallet, a loan modification is not the same as refinancing. In a modification, your loan terms are changed. In refinancing, you get a whole new loan. Modification allows your lender to adjust the terms to help make your payment more affordable for your current financial situation. It can help you to avoid refinancing and extra charges, along with keeping foreclosure away.
While lenders each have their own guidelines for qualifying for a modification, in general, you will need to prove that you are struggling financially. You have to provide some tangible proof of why you are unable to make your current loan payment. You also need to be at risk for missing a payment or be 60 days late on your mortgage payments.
Most banks have a special program for modification, so you can generally ask for a modification application. In some cases, your lender may approach you with this option. If you feel that your financial situation is dire and foreclosure is imminent, then modification may be the solution you need. This information is for education and is not legal advice.