Lancaster Loan Modification Lawyers
Many Los Angeles County families are currently struggling to meet their monthly mortgage payments. There are several options for dealing with these situations. One of them is to seek a loan modification. Unlike refinancing a mortgage, which involves replacing the original mortgage with a new loan, a loan modification simply means changing the terms of an existing mortgage.
Lenders are often willing to negotiate loan modifications in order to avoid the time and expense of a possible foreclosure. But you should not try to deal with the bank on your own. An experienced Lancaster loan modification lawyer can represent you during the process. Wadhwani & Shanfeld is a team of dedicated California debt relief attorneys who have helped thousands of clients get out from under a bad mortgage. We can review your current mortgage and overall situation and help you develop the best legal strategy for rebuilding your finances.
How Loan Modification Works in Southern California
Obviously, most mortgage lenders will not grant you a loan modification just because you ask for one. You typically need to demonstrate some sort of financial hardship. The exact requirements will vary by lender, but some common examples of hardship include:
- a sudden loss of income;
- a death in the family;
- the failure of your business;
- a long-term illness or disability in the family;
- divorce or legal separation from a spouse;
- a substantial increase in the costs of maintaining the house;
- a natural disaster;
- a public health emergency; or
- the homeowner was suddenly called into active military service.
If you can properly document a hardship and meet the lender’s other requirements, you may be able to seek loan modification on a number of terms, such as:
- Reduced Interest Rates: A reduction of your mortgage’s interest by even a single percentage point can save you thousands of dollars per year–and unlike refinancing a mortgage, you will not have to pay any closing costs or fees for a loan modification of your interest rate.
- Switching Interest Terms: In some cases, it may benefit you to modify a loan from an adjustable-rate to a fixed-rate mortgage. This may not lower how much you pay each month to the lender, but it can protect you against rising interest rates later on.
- Extending the Loan: Your lender may agree to extend the term of the loan, giving you more time to pay off the principal and thus reducing your monthly payments. Keep in mind, you will continue to pay interest on the additional months or years of the loan’s term.
- Reducing the Principal: In rare cases, a mortgage lender may agree to lower the amount of principal owed.
Contact Wadhwani & Shanfeld Today
Loan modification is just one debt relief strategy you may need to consider. For some debtors, filing for Chapter 13 bankruptcy may offer a better way to keep their home while catching up on a mortgage. That is why you should speak with an experienced Lancaster loan modification attorney before taking any action. Contact Wadhwani & Shanfeld today to schedule a consultation.