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Loan Modification Calculator

#loan modification calculator

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Mortgage Loan Modification Calculator – Estimate Your Monthly Savings

#loan modification calculator

Mortgage Loan Modification Calculator Estimate Your Monthly Savings

Many people want to get a home loan modification, but have no idea how much money they will save if they were to be approved .  Don t waste your time, read on

The fact is, many homeowners payments actually go up with a modification.  A typical scenario goes like this:  A person got their loan a few years ago and it was an interest only loan.  The loan is about to adjust, so they realize their payments are going to increase.  They apply for a modification and after weeks of paperwork and calling their lender they learn that their new payment is going to increase with a modified loan, not helping them at all!

Why?  Because the new loan terms give them an interest rate of say 4%, which we all agree is higher than 0%, making their payments go up.

Another scenario is where the homeowner does not have their property taxes and insurance impounded into the loan.  When you get a modification, these are included in the payments, making your monthly payments higher than they were before.

Well,  for those people who are looking to modify, they can now use our free loan modification calculator and determine how much they will save before they apply.   You just enter in a few details (you should know these off the top of your head, no need to search through paperwork) and our mortgage modification calculator will tell you if you would qualify and how much your modified payment would likely be.

The calculator uses the Governments Home Affordable Modification Guidelines to determine your payments.  There is no guarantee you will be approved for this program, but many lender do participate in it.   Many lenders have their own in-house modification guidelines which are usually pretty similar the the governments program.

Here is the Mortgage Loan Modification Calculator:

Click the continue button above to input your data, the next page shows your monthly savings!

After you input your data into the home loan modification calculator. you will see if you are a candidate for a loan modification or not.  This is determined by using the data to figure out if your mortgage payment is currently more than 31% of your monthly income.

Next, if you do qualify, you will see what your estimated payment would be.   This is very helpful to homeowners.  The main reason most people want to modify their loans is to save money!  They are struggling to make their mortgage payments each month and are hoping that a modification will allow them to comfortably afford their mortgage once again.   If the payment shown is low enough to help you, you will know that all the time spent trying to get your modification approved will be well worth it in the end.

There are many mistakes homeowners make when applying for a loan modification, so you should definitely check out our post on how to get a loan modification approved .   You will learn the most important reasons homeowners are denied their loan modifications and how to avoid being one of them!  It s really quite simple once you know what to do.

If you feel that a the loan modification process is quite overwhelming or maybe you are working full time and will not have the free hours necessary to complete a loan mod on your own, you should check out the reviews of no upfront fee loan modification companies .   These companies can handle the whole process for you, from preparing your packets to negotiating your interest rate with your lender.  It s definitely worth talking to them, there is no obligation and you just might learn a few things you didn t know before.

That s it for this time, we hope you enjoyed the free loan modification calculator !

What – s the difference between a loan modification, forbearance agreement, and repayment plan?

#mortgage loan modification

What s the difference between a loan modification, forbearance agreement, and repayment plan?

Loan modifications, forbearance plans, and repayment plans can help you avoid foreclosure if you are struggling with your mortgage. Learn more.

Loan modifications, forbearance agreements, and repayment plans are different ways that borrowers can avoid foreclosure. Read on to learn the difference between these options and how they can help you if you are having trouble making your mortgage payments.

Loan Modifications

A loan modification is a permanent restructuring of the mortgage where one or more of the terms of a borrower’s loan are changed to provide a more affordable payment. With a loan modification, the lender may agree to do one of more of the following to reduce your monthly payment:

  • reduce the interest rate
  • convert from a variable interest rate to a fixed interest rate, or
  • extend of the length of the term of the loan.

Generally, to be eligible for a loan modification, you must:

  • show that you cannot make your current mortgage payment due to a financial hardship
  • complete a trial period to demonstrate you can afford the new monthly amount, and
  • provide all required documentation to the lender for evaluation.

Required documentation will likely include:

  • a financial statement
  • proof of income
  • most recent tax returns
  • bank statements, and
  • a hardship letter.

There are many different loan modification programs available, including proprietary (in-house) loan modifications, as well as the Home Affordable Modification Program (HAMP), which is part of the federal government’s Making Home Affordable initiative. HAMP assists borrowers by modifying their first lien mortgages so that the monthly payments are lower and more affordable. To learn more about HAMP, see The Home Affordable Modification Program (HAMP). (To find out about other government programs for struggling homeowners, see our Government Foreclosure Prevention Programs  topic area.)

If you are currently unable to afford your mortgage payment, and won’t be able to in the near future, a loan modification may be the ideal option to help you avoid foreclosure.

Forbearance Agreements

While a loan modification agreement is a permanent solution to unaffordable monthly payments, a forbearance agreement provides short-term relief for borrowers. With a forbearance agreement, the lender agrees to reduce or suspend mortgage payments for a certain period of time and not to initiate a foreclosure during the forbearance period. In exchange, the borrower must resume the full payment at the end of the forbearance period, plus pay an additional amount to get current on the missed payments, including principal, interest, taxes, and insurance. (The specific terms of a forbearance agreement will vary from lender to lender.)

If a temporary hardship causes you to fall behind in your mortgage payments, a forbearance agreement may allow you to avoid foreclosure until your situation gets better. In some cases, the lender may be able to extend the forbearance period if your hardship is not resolved by the end of the forbearance period to accommodate your situation.

In forbearance agreement, unlike a repayment plan, the lender agrees in advance for you to miss or reduce your payments for a set period of time.

Repayment Plans

If you’ve missed some of your mortgage payments due to a temporary hardship, a repayment plan may provide a way to catch up once your finances are back in order. A repayment plan is an agreement to spread the past due amount over a specific period of time.

Here’s how a repayment plan works:

  • The lender spreads your overdue amount over a certain number of months.
  • During the repayment period, a portion of the overdue amount is added to each of your regular mortgage payments.
  • At the end of the repayment period, you will be current on your mortgage payments and resume paying your normal monthly payment amount.

This option lets you pay off the delinquency over a period of time. The length of a repayment plan will vary depending on the amount past due and on how much you can afford to pay each month, among other things. A three- to six-month repayment period is typical.

To get information about these and other options to avoid foreclosure, see our Alternatives to Foreclosure  area.