Loan Modifications
Loan Modifications
What is Loan Modification?
Loan modification is a change made to the terms of an existing loan by a lender.
A loan modification may involve a reduced interest rate, a longer period to repay, a different type of loan, or any combination of these.
Such changes usually are made because the borrower is unable to repay the original loan. Most successful loan modification processes are negotiated with the help of an attorney or a settlement company. Some borrowers are eligible for government assistance in loan modification.
Although a loan modification may be made for any type of loan, they are most common with secured loans such as mortgages.
Can I Modify My Mortgage in a Chapter 7 Bankruptcy?
Unlike a Chapter 13 bankruptcy, Chapter 7 bankruptcy
doesn’t have a mechanism that will help you save a house when you’re behind on your payments, however, if, after you file for Chapter 7 bankruptcy, your lender agrees to a loan modification .It will be entirely at your bank’s discretion, and your lender will likely want you to wait until it’s clear that your trustee has no interest in selling the property for the benefit of your creditors.
Chapter 13 Bankruptcy
If you are behind on payments, and in danger of losing your home, or have nonexempt equity that a Chapter 7 trustee could use to pay settle your debts, you should consider filing Chapter 13 Bankruptcy. If you file for Chapter 13 bankruptcy, you can keep your property even if you have nonexempt equity. You’ll pay some portion of your debt through a payment plan that will last from three to five years. You can modify your mortgage while you’re in a Chapter 13 case, as well.
Call (407) 478-0074
today to speak directly with an experienced Orlando, Florida, loan modification lawyer, contact us by e-mail
or complete our contact form, if you have a question about loan modifications.
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