Friday, May 5, 2017
Will A Mortgage Modification Impact My Credit?
If you are having a hard time paying all of your bills, chance are there are some dings on your credit report. This can make it hard to get loans at good rates, and might even affect your chances of renting a car or an apartment. The bottom line is that credit scores are important financial tools, and keeping yours in a healthy state will help you to manage your money better. So, when you need to make adjustments to your monthly obligations, it is important to know how certain acts will impact your credit.
One way to take charge of your monthly finances is to get a modification of your mortgage. A mortgage modification will give you a lower monthly house payment, and you can use this extra money to pay other bills without feeling as much of a pinch. If you are considering making an application for a modification, here are some things you should know about whether a mortgage modification will impact your credit:
• The type of modification plan you are seeking plays a role: if you are able to get a plan that is backed by the government, the modification should not have an adverse impact on your credit score. But if you are doing a loan modification through another entity, the chances of it being reported on your credit increase. This is because most programs that are not government programs are actually debt consolidations. When you consolidate debt, a report is made on your credit that the debt is being compromised for less than what is owed.
• The way your lender reports the modification might impact your credit score as well: credit bureaus only pick up data that is reported by lenders, so make sure your lender is reporting your modification properly in order to avoid any confusion or inaccurate information on your credit report.
This part of mortgage modifications is an often overlooked aspect of the process, but when we take on your case we make sure to cover all areas of the matter. We know how important it is to keep your credit score in good standing, because once you repair your finances you will have future financial needs. Our job is to get you back on track with your money, and if you are not able to obtain favorable loan terms down the road all of your hard work will feel meaningless.
For more information about managing your mortgage payment or asking for a modification, call us today or reach us online at www.law-ri.com. We will help by looking at the facts of your case and giving you options to reach your financial goals.