Tags: Long Island foreclosure attorney, Long Island foreclosure defense, Long island foreclosure lawyer, Long Island Loan Modification
When a homeowner fails to make his updated monthly mortgage payments, he risks having the lending institution foreclose on his home. In this case, the homeowner should seek the help of a Long Island foreclosure lawyer for guidance in lessening the stressful and financially draining impact of foreclosure on his future.
How Mortgage Modification Works
One way of accomplishing this is by employing the method of mortgage modification, in which a more reasonable payment system is agreed upon by the lender and the homeowner. This allows the homeowner to improve on his current mortgage loan instead of applying for an additional mortgage, which will only increase his financial burden. Mortgage modification decreases the amount and interest of his monthly payments as well as increases the number of years that he can repay his loan.
Homeowners who are unable to pay their mortgage payments due to financial difficulties are advised to avail of the mortgage modification scheme. The idea of refinancing their mortgage may have been initially considered, but this option is unattainable due to financial constraints or non-flexible loan terms of the lending institution. It would be wise to contact a qualified Long Island foreclosure lawyer immediately in order to prevent the inevitable consequences of a foreclosure, such as a tarnished credit history and difficulty in applying for new loans in the future.
How to Qualify for Mortgage Modification
There are several common standards in qualification which have to be followed by a homeowner in order for him to avail of a mortgage modification (each lending institution or bank, however, has its own set of criteria that the homeowner must abide to). With the help of a knowledgeable Long Island foreclosure lawyer, the homeowner must show records as evidence that he is indeed financially strapped, has been delinquent in making his monthly payments for three consecutive months (as a result of his financial difficulties, and not because the said delinquency was intended), and has been occupying his home as its principal resident.
How One Can Benefit From Mortgage Modification
What tangible benefits can be gained by a homeowner who is experiencing financial difficulties from a mortgage modification? The most obvious advantage is the avoidance of impending foreclosure of his property. The home owner is given flexibility and sustainability in making his monthly mortgage obligations to the lending institution, and this setup actually serves to benefit the lending bank as well because it is assured of the willingness on the part of the homeowner to fulfill his financial obligations. Furthermore, it allows the lending institution the freedom from having to resort to a foreclosure process that takes up valuable time and adds to its own set of financial hardships. By providing the mortgage modification scheme to the homeowner, the lender experiences a much reduced loss compared to spending more time and money on foreclosure proceedings.
Mortgage Modification In The Past
For quite a long time, mortgage modification has already been offered by lending institutions to homeowners in financial crises. But the present widespread foreclosures in the country, especially in Long Island, have given rise to its increased use, as it is one of the best options that an experienced Long Island foreclosure lawyer could offer to the homeowner who seeks his assistance. The homeowner’s inability to refinance his existing mortgage, coupled with his failure to prevent defaulting on his payments, is the favorable conditions for a mortgage modification application.
Mortgage Modification At Present
The tendency to employ the mortgage modification scheme has become prevalent in present times due to the ongoing crisis experienced by the housing industry. Foreclosures became widespread as mortgage lenders succumbed to the pressure of keeping their lending businesses by offering severely lowered interest rates and more lenient requirements to their borrowers. In the process, this practice attracted a large number of borrowers who would not have passed the original standard criteria but who got their loan applications approved in the end. These new breed of unqualified homeowners inevitably defaulted on their monthly mortgage payments and were predictably served with foreclosure notices. The fortunate development to come out of this distressing housing issue was the government’s initiative of encouraging mortgage lending institutions to allow at-risk homeowners to have their monthly payments and interests lowered and their loan term lengthened through mortgage modification.