What a Loan Modification is, and How it Can Stop Foreclosure in Utah

Using a loan modification to help you stop foreclosure in the Salt Lake City, Utah area is a great solution for all parties involved. By getting a loan modification you get to keep your house and you save your credit by not having a foreclosure on it. The bank gets to keep receiving payments and making money. So a loan modification is a win win situation and stops your home foreclosure.

There are a couple of ways that a loan modification may take effect. To help you know what to expect I have given you the options that the bank will face when considering your loan modification.

-Forgiving a payment.
This is called debt forgiveness, and it rarely happens. This is where the mortgage company will stop the foreclosure process and forgive you in your current situation. It will be as if you had never missed any payments.

-Spread out the missed payments over a longer term.
This is called forbearance. The mortgage company takes your missed payments and calculates an interest rate that they will charge you over a period of usually a year or two. This will raise your payments on your home, but you will be able to keep it. This is the most popular option among the mortgage companies.

-Changing the terms of your loan.
This is called a note modification. This is where your lender adjusts your interest rate, the length of the loan, or they may forgive a part of the loan balance, to make your payments more manageable. This is not done very often but as a homeowner it is the solution that I would want to stop foreclosure.

-Add the back payments to your loan balance.
This is similar to spreading your missed payments over a term, only the term, instead of 1 - 2 years, is the life of the loan. This option will increase your payments but only by a small margin.

-Make a separate loan to you.
This is called a partial claim. Some government loans let borrowers who meet specific criteria apply for another loan, which will pay back the missed payments. In this situation it will stop foreclosure, but you will have more loans and more payments on your house.

Working a loan modification is not an option that will work for everyone. You need to know your options to make an educated decision on the solution that is best for your. You can download a Free Report to help you understand your options at www.StopHomeForeclosureUtah.com. Go to that website, input your name and email and your free report will be waiting for you in your email box.