If you are considering a loan modification in Florida, you probably have a number of questions about the loan modification process, specifically, why would a bank offer a loan modification to a homeowner in place of a refinancing of the mortgage?
Why Banks Do Loan Modifications
Investors may benefit from loan modifications, as they have the potential to minimize losses. In the past several years, residential mortgage loan servicers have not applied this loss mitigation
strategy with great frequency. Many servicers have, historically, used refinancing as an alternative to loan modifications. However, this is expected to change with slowing home price appreciation
and the rise in the number of borrowers falling behind or potentially falling behind on their mortgage obligations.
Remember, it’s not a refinance, it’s a renegotiation.
Who Is A Candidate For A Florida Loan Modification?
- Homeowners who experienced a hardship
- Borrowers in an adjustable rate mortgage
- Falling behind in their payments* (not always)
- Not behind in payments but facing hardship
- Rates above 8%
- Unable to refinance
- Upside down in home valueUpside down in home value
