What Can A Loan Modification Do For Me?
A San Francisco bankruptcy attorney responds to: What Can A Loan Modification Do For Me?
Loan modifications are changes to the contractual terms of your mortgage. Generally the changes result in either some of the outstanding balance being reduced or a reducing in your monthly payments. Whatever the change, loan modifications are designed to help those who otherwise are having a difficult time meeting their monthly mortgage obligation.
There are some drawbacks associated with the loan modification process. Generally lenders will not modify the terms of an existing agreement unless the borrower can show the mortgage is causing a hardship for the household. The most common “requirement” is that the borrower not be current on their mortgage payments. Those who are current and up to date with the payments have a much more difficult time modifying the terms of the agreement.
Lenders will typically set up a borrower on a trial period in order to test how the new monthly payments will work. If the borrower successfully makes it through the trial period the lender may choose to make the modified terms permanent. Often this includes building whatever arrears have accumulated back into the payment terms.
Advantages of obtaining a loan modification mean that you often are no longer considered in default with your mortgage because any default amount is built back into the new payments. This can potentially help those who would otherwise need to file a chapter 13 bankruptcy in order to save their home. A loan modification will generally allow those thinking of bankruptcy to proceed under chapter 7 to discharge debts instead of working out a repayment plan with respect to mortgages.
If you have questions regarding bankruptcy in San Francisco or bankruptcy in the greater Bay Area please contact our San Francisco Bankruptcy Attorneys at (415) 946-8882 or (1800) 941-6730 for a free consultation or visit www.sagarialaw.com and request a free face to face appointment in a Sagaria Law office location nearest you. Our team of Bankruptcy Lawyers, Bankruptcy Client Care Specialists and Bankuptcy staff supporting San Francisco and Bay Area consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, San Francisco Bay Area!
