What Is a Loan Modification?

• David Kohm


• 18 Oct 2012

Buying a home is a huge investment, and usually requires taking out a large loan in order to pay for the purchase. However, some loans come with high interest rates that can be difficult to pay, especially if you’ve recently suffered a job loss or a severe illness or injury. The Arlington bankruptcy attorneys with the Law Offices of David Kohm understand that in this economy, paying back your high interest loans can be difficult. That’s why they offer legal counsel when it comes to loan modifications.

According to the U.S. Department of Housing and Urban Development, a loan modification is “a permanent change in one or more of the terms of a Borrower’s loan, allows the loan to be reinstated, and results in a payment the Borrower can afford.” This description may make the process sound simple, but in reality, it’s very difficult. That’s why you need to consult a lawyer before considering loan modification.

Loan modifications are generally not to the lender’s benefit. These modifications reduce the amount of money the lender will receive, because they require the lender to either reduce the principal balance or fix the interest rate. This reduces the amount of money the lender receives from you, and many lenders will attempt to slow or stop the process by providing you with misinfortmation. Mortgage companies also look unfavorably on the loan modification process, and can make it difficult to continue the process on your own.

Dealing with your lender is tough, and you need a tough lawyer to fight for you. Attorney David Kohm leads the team at the Law Offices of David Kohm and has over 20 years’ experience in bankruptcy law. With a proven track record of success, this Arlington lawyer will fight aggressively for your rights and needs as a borrower. If your loan payments are too much for you to handle and you’re considering entering the loan modification process, call the Law Offices of David Kohm to schedule a free consultation: 817-204-0900.