It is a common misconception that loan modification is an option that is only open to homeowners facing foreclosure and at risk of losing their home. They may also think it is only available to those who earn a low income, or whose circumstances have changed financially and they can no longer afford their repayments. Although it is true that a loan modification is an option most commonly explored by those in this high risk group, it is by no means a desperate last ditch solution. In fact, most homeowners could potentially benefit from a loan modification; they may also find it easier to get a modification approved than those who are in financial difficulty.
Buying a home is undoubtedly the biggest expense a person will have in their life, so when they find a home they fall in love with they agree to the terms of repayment and interest rates set out by their mortgage provider. Even if they are up to date with their payments, there is nothing stopping them from shopping around and finding a loan modification company or attorney who could save them money.
As mentioned previously, homeowners who are financially stable and up to date with their payments may find it easier to be accepted for a loan modification than those who are already behind on payments or are already threatened with foreclosure.
Benefits for those who are up to date:
- Good credit scores because of on-time payment may qualify the individual for a lower interest rate.
- If there has been equity built up on the property, then they can use this to offset a new mortgage at a lower amount than their previous one.
- These can lead to easier acceptance, and saving money per month on repayment.