Loan Modification
If you're struggling to keep up with your mortgage payments, working directly with your mortgage company to obtain a loan modification can be a valuable option. A loan modification adjusts the terms of your loan to create an affordable monthly payment, helping you stay in your home and avoid foreclosure.
Who Qualifies for a Loan Modification?
Loan modifications are offered for borrowers 90 days late on payments for owner-occupied homes, but some non-owner occupied properties have also been approved—approval ultimately depends on your lender. It is an option that is worth exploring, even if you ultimately get denied.
What Does the Loan Modification Process Look Like?
Essentially, you are applying for a new loan requesting terms that better fit your current financial situation. To qualify, you will need to provide:
Employment history
Proof of sufficient income
Financial documents such as 2 years of tax returns, 2 months of bank statements, pay stubs, and other income documents
Completed application, an expense sheet, and a hardship letter explaining your situation
Once you submit these documents to your lender, they will review your case. If accepted, you’ll enter a trial payment period, where you must make timely payments for a set number of months. After successful completion, your lender will conduct a final review. If approved, you’ll receive a new mortgage agreement with modified terms.
Keep in mind, if the new payment doesn’t fit your budget, you are not obligated to accept it and you do have other options.
What If Your Loan Modification Is Denied?
If your loan modification request is denied, selling your home is an option to consider. Contact us to receive a free market analysis and consultation—we’ll review your options, potential fees, and what you could net from the sale. If you owe more than the house is worth, see our dedicated Short Sale page
Filing for bankruptcy may also be a possible route to protect your home and finances. For more details, please see our dedicated Bankruptcy page.
Need Help Navigating the Process?
HUD-approved housing counselors are available in most areas and often provide free or low-cost assistance with loan modifications and foreclosure prevention. We can help connect you with a reputable counselor near you—just fill out the questionnaire on the Contact Us page
Special Programs for Seniors and Disabled Homeowners
If you are current on your payments, but are looking for options to lower your payments and qualify for an exemption on your property taxes, this is a great option if you qualify.
If you are a senior or disabled with limited income, you may qualify for reduced property taxes, which can lower your overall housing costs. Check your county assessor’s website for information on the Senior Exemption Property Tax program. Simply search for "Senior Exemption property taxes" on the site to find detailed instructions and eligibility requirements.
Ready to Take the Next Step?
If you’re facing mortgage challenges and want to explore your options, we’re here to help. Fill out our Contact Us questionnaire today to receive a free market analysis, consultation, and guidance tailored to your situation. Don’t face this alone—reach out now and let’s find the best solution for you.