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Real Estate

Loan Modifications

Financial problems like a job loss or other financial crisis can happen at any time. However it does not have to end up with your home being lost to foreclosure.  The strain that financial difficulties can place on family resources can sometimes be too much to bear.  Also, the stress that is placed upon a family to keep up mortgage payments can be great.  Unfortunately, mortgage payments do fall behind and of course the mortgage company still expects to be paid on time each and every month.  


Loan Modifications are a way to work out a mutually agreeable solution to the problem of falling behind on your mortgage payments.  No matter what type of Loan Modification program is selected, a Loan Modification allows the homeowner a way to rework the original loan into a form that the homeowner can handle.   The goal is to adjust the terms of your loan to be in line with your present financial abilities.  


When looking at Loan Modifications, one realizes that there are several ways to go.  Of course, you have the In House option, which is what most people think of when they think Loan Modifications.  Within the In House option, the lender and the homeowner rework the loan to adjust the terms of the loan.  Terms such as the interest rate and length of the loan in years are adjusted.  The end result is a loan that the homeowner can now handle even with their new financial limitations.  The only real negative usually is that the homeowner has a longer term in years to be making payments. 


Of course, there are other Loan Modification programs available.  For example, the Home Affordable Modification Program and its cousin, the Home Affordable Modification Program Tier 2 immediately come to mind.  Like the In House Loan Modification Program, loan requirements and terms are adjusted so as to help the homeowner be able to make their payments.  Often, delayed repayment as well as interest rate concessions and loan length are changed.  The concessions make the homeowner much less likely to lose their home, which is a win for both the lenders and the homeowner’s point of view.   


There is also another popular Loan Modification Program called the Shared Appreciation Modification Program.  In this one, the lender typically lowers the principal value of the loan to be more in line with market value of the home.  In return, the homeowner agrees to share a percentage of the future equity of the property with the lender.  Again, the result is that the homeowner is afforded the opportunity to remain in their home and the lender gets to possibly get a windfall payment upon the future sale of the home.  It seems that, again, both parties come out ahead of the game.  The homeowner gets to remain in their home and the lender not only avoids having the property returned to them, they ensure continued payment from the homeowner as well as a future share in the increased equity of the home upon sale.  


These are some of the Loan Modification programs available.  It is critical for the individual applying for a Loan Modification to realize that getting one of these programs is not a cakewalk.  There are demands and pitfalls that the homeowner is exposed to.  Any of these pitfalls can doom their application and make it ultimately unsuccessful.  While the Loan Modification process is ongoing, the homeowner has to be sure they keep up their regular payments. 


 In addition, another potential pitfall is that the homeowner is required to deliver a voluminous amount of paperwork somewhat like the process they had to go through when they originally applied for their loan.  In addition, since the Loan Modification process takes time, they have to keep the documents they provide for their Loan Modification application current.  Often, the documents have to be very recent and the Loan Modification applicant has to keep updating their paperwork just as when they originally applied for their original loan. 


At Glyptislaw, we realize that the Loan Modification process is not only time consuming but filled with difficulties that could easily ruin a homeowner’s attempt at successful completion of the application process.  We interceed for the homeowner and handle the process for them.  In doing so, we often can avoid and successfully finish what the inexperienced homeowner would often fail at.  


Remember, the Loan Modification process is not only demanding and lengthy, it can also be very costly.  You see, while the homeowner is going thru the process in a trial and error fashion, the Fees that the lender charges keep accumulating.  This can make it alI much more expensive for a homeowner to go thru it as opposed to our firm.  We will get it done faster which in turn saves you time and a lot of money.  In addition, having our firm handle the process will give you a better chance at success because, simply, you are not guaranteed to be approved. 

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