Homeowners who do not meet the eligibility criteria for refinancing can apply for mortgage loan modification. People have lost jobs or have encountered cutbacks in paychecks due to the economic slump. So, the monthly mortgage payments take up a chunk of their income. The home loan modification program assures that the monthly payments do not surpass 31 percent of an individual's monthly income. Borrowers can avail for interest rates as low as two percent, and repayment duration as long as 40 years. Hence, low monthly payments are guaranteed. The principal amount in not reduced under the plan though. Lenders are not forced to participate in the program. However, the program is, in most cases, more profitable than foreclosure. Hence, they choose to modify the mortgage. There will be a three-month trial period with the new loan terms. If the homeowner is still current at the end of the ninety days, the modified terms stay in effect for the next five years. An interesting incentive for borrowers is that they can receive up to $1,000 for five years as long as they stay current on their payments. However, the money is used to pay down the balance on their loan. It is not handed over to the homeowners lest they spend it away. | welcome to Insurances.net (https://www.insurances.net) | Powered by Discuz! 5.5.0 | (php7, mysql8 recode on 2018) |