When someone has difficulty repaying their loan, particularly a mortgage, it might be a good idea to investigate having the loan modified rather than letting it go into foreclosure. Here are details on what loan modification is and what kinds of questions you should ask any loan modification lawyers you’re considering hiring.

What Is Loan Modification?

Loan modification happens when the lender changes the term of the original loan contract. The changes are usually made because the debtor has fallen behind on payments or knows they’re going to have difficulty repaying the loan on its original terms. Modifications can be things like extending the length of the loan repayment period, refinancing, transferring to a different type of loan, reducing the loan’s interest rate or converting from a variable to a fixed interest rate, or reducing the principal balance.

Do I Need an Attorney to Negotiate Loan Modification?

Loan modifications can be complex and having an experienced lawyer assisting with the negotiations can potentially bring about better outcomes for the debtor. The lender will have specific criteria that the debtor needs to meet, and the attorney will be able to determine what those are and if the debtor has them. The attorney will also ensure the lender hasn’t violated any state laws or regulations in the original loan contract. It’s especially valuable to have an attorney assisting if the lender has already filed a notice of foreclosure.

What Questions Should I Ask a Loan Modification Attorney?

How Much Experience Do You Have With Loan Modifications?

Because of the complexity of loan modification negotiations, working with an experienced attorney is a must. They’ll understand the legal terms and know what pitfalls to watch out for.

How Long Does the Loan Modifications Process Take?

The process varies by case. Sometimes a lender may try to run out the clock to get to the point they can file the foreclosure and sell the home. An attorney will work to avoid that and recognize the signs that that’s happening.

How Much Will an Attorney’s Services Cost?

That will also vary depending on how long the negotiations take and how complex the situation is. But in general, the attorney will work to keep the process as short as possible to avoid foreclosure.

Have You Ever Worked on Loan Modification With My Lender?

Some lenders operate more in good faith than others. If your lender tends to provide difficulties, having an attorney who’s worked with them before is helpful. But overall, an experienced loan modification attorney has likely seen many strategies from lenders and will be able to work with them.

Are You Willing to Use Violations of Law While Negotiating?

Violations of law mean that the lender used terms that either violated law or appear deliberately misleading. It can be contentious but having an attorney who knows how to find those terms and use them in the debtor’s interest can lead to better outcomes for the debtor.

Let Us Advise You

If you or someone you know is considering negotiating a loan modification, call us at 708-575-1500 to work with one of our experienced loan modification attorneys.