Getting Loan Modifications without Getting Cheated

Loan modifications are almost the last options for people who risk losing their home to foreclosures. In case you are wondering, it means modifying your loan so that you could manage to pay it back. It could be a change in the term, a reduction in the mortgage payments, at times even a reduction in the amount to be paid. The lenders agree to it because foreclosures are losing terms for them as well. At times, it is better for the lender to modify the loan than to go for foreclosures. Unfortunately though, there are many unsavory elements that take advantage of the desperation that a homeowner who risks foreclosure feels and try to rip them off by promising loan modification. You have to keep a wary eye out for such people.

Here are some tips that would help you get loan modification without getting cheated in the process –

  1. Call the Lender Yourself – It is not necessary that you should get an outsider to get your loan modifications done. You could try the direct approach. Many lenders have loan modification departments, so call them and ask them to guide you to the concerned department. If they say they don’t have them then ask them to guide you to loan mitigation department. And don’t be disheartened if they at first say no. Persist.


  1. Threaten Bankruptcy or Foreclosure – Since lenders dislike foreclosure very much you could threaten them with that to get them to agree to modifying your loan. Say the process will drag on for a long time if they do not agree to do something. And if you threaten bankruptcy it would be worse for them.
  2. Get Help from Licensed Folks – If you cannot get the loan modifications on your own get help from licensed people who specialize in it. Do not go for people without any license or reputation. Do not be taken in by ads.


  1. Do Not Pay Any Money Upfront – If any loan modification company asks for upfront fees then they are most certainly trying to cheat you. Hence do not pay any fees in advance.


  1. Ask for More Be Ready to Settle for Less – You should naturally ask for the most you could get by means of loan modifications. But this does not mean the lender will give you whatever you ask for. So be ready to settle for anything that you can manage and would improve your situation. Getting a professional appraisal done would also help your cause.


Loan modifications, if done properly can save your home and can save the lender all the bother of a foreclosure.

Written by Carol Pefley

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