Four Good Alternatives When Loan Modification Doesn’t Work

Asking your lender to modify your mortgage is a good way to get a lower house payment, and in most instances lenders are agreeable to the modification. But there are times when lenders don’t agree to your request, or the end result is not financially beneficial to you. When that happens you have to look for another way to lighten your loan, and with the right partnership it can happen. An experienced bankruptcy and debt management attorney can help you find what works for you.

Four good alternatives when a loan modification doesn’t work, and that could be helpful to you, are:

•         Bankruptcy: bankruptcy will eliminate or reduce most of your debts, and allow you to pay for what you want to keep without having to pay the rest of your burdensome debt.

•         Refinancing your mortgage: a refinance has nearly the same impact as a modification, it is just not done by your current lender. That means you may have to do extra things, like get an appraisal, but if you are able to successfully refinance to a lower payment, the cost of the appraisal will quickly be absorbed.

•         Give your lender back title to the home: This can stop a foreclosure, but will mean you are not able to keep your house. Stopping a foreclosure is always a good thing, and if your house is more than you can handle then turning it back over and finding affordable living arrangements can help straighten out your budget.

•         Asking to put the past due payments on your home loan at the end of your note. This is the equivalent of asking your lender to consider you current on your loan when you are not, and is similar to a modification but not quite the same. You can also ask your lender to let you make payments and ½ or some other creative payment structure until you are caught up and can get back on track.

One of these alternatives usually works for most people, and we can help you figure out which one will work for you. The key is to try not to panic, and know that help is just a phone call away.  

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.