Modifying an existing loan for repayment Loan modifications might involve restructuring the existing loan through (1) a reduction in the principal balance, (2) a change in interest rate or (3) extending of the term of the loan. In some cases a different type of loan might be implemented or a restructuring involving any combination of the three methods could be executed. A lender might be amenable to modifying a loan because the cost of doing so is less than the cost of default or foreclosure. The modification sequence may involve first reducing the interest rate (subject to a rate floor of 2%) and/or reducing principal to reflect the current fair market value (subject to lender qualifying conditions), then if necessary extending the term or amortization of the loan up to a maximum of 40 years, and then if necessary forbearing principal.

A loan modification agreement is different from a forbearance agreement. A forbearance agreement provides short-term relief for borrowers who have temporary financial problems, while a loan modification agreement is a long-term solution for borrowers who are not able to keep with the existing payment structure.
Loan modification is a term unfamiliar to most homeowners.  What many homeowners are coming to realize is that losing their house to foreclosure is a possibility.  Home foreclosure in America is at an all time high in 2009 and is affecting many homeowners that never before envisioned losing their home to foreclosure.  Homeowners are experiencing the financial pressure of higher interest rates (from loans whose rates are resetting) and a slowing economy.  A loan modification is one way for a homeowner to save the biggest investment of their life--their home.

Negotiating with a bank for a modification of a home loan can be overwhelming for many homeowners. That is why retaining the services of the attorneys at Blue Capital Law Firm, P.C. rather than a loan modification company is critical.

Today’s nationwide real estate market is experiencing steep drops in property value coupled with tighter credit conditions.  The combination of the two trends makes a volatile environment for a borrower facing higher payments due to maturing of an adjustable rate mortgage (ARM).

It may not always a good idea for borrowers to take on a lender alone, as they first might be inclined to do.  With our real estate experience, the attorneys at Blue Capital Law Firm, P.C. will represent borrowers in bringing a mortgage lender to reasonable terms that make better sense in today's volatile economy.  

Many homeowners think refinancing a mortgage with a high interest rate is the best answer, if that is even possible given the recent dramatic decline in property value.  During vibrant economic times, refinancing at a lower interest rate would be a sound decision, although it may be costly to do so, due to the points, appraisal costs and other fees associated with refinancing.  In today's market this formula may not the best solution or may not be a viable option altogether.  The attorneys at Blue Capital Law Firm work diligently to alter the terms in mortgages for those homeowners in need in order to create viable solutions between borrowers and  lenders.

A good modification will allow homeowners to stay in the home when negotiation results in a payment package that is affordable for the long run.  Many new mortgage loan modifications are re-defaulting within sIx months of receiving their new modified terms.  This means that most modifications are not being modified to a degree that is affordable on an ongoing basis.  This is mainly due to homeowners that are not well represented, do not have adequate representation, do not get sound advice, and/or are unable to properly present their situation to their lenders in order to get an adequate loan modification.  Our attorneys at Blue Capital Law Firm are committed to advocating on your behalf to secure you the best possible mortgage loan modification.

In light of the recent enactment of California SB 94 on October 12, 2009, our firm will no longer require an advance retainer fee deposit for all new clients for loan modification / foreclosure assistance work that involves California residential properties (comprising of 1-4 units).

ADDITIONAL DISCLOSURE

All clients, existing or prospective, are hereby advised that there may be a number of existing non-profit loan modification counseling agencies that may offer you similar services, at no charge, that our firm is offering, although of course, the level of their services, experience, expertise and/or commitment to your case matter may vary from ours, as we are not certain if such agencies actually employ attorneys (with similar background and experience) to work on your case file. Nevertheless, operating in accordance with our ethical guidelines and principles, we fully provide this full disclosure to you now.

Further, although our attorneys have much experience in real estate law, mortgage finance, loan underwriting and debtor/creditor issues (including bankruptcy) and while we may be reasonably confident in the level of our services, PLEASE DO NOTE THAT WE CANNOT GUARANTEE ANY RESULT OR OUTCOME.  We value every client, and we understand the difficulties that many current homeowners are now experiencing, and we only want our prospective clients to proceed on an informed basis.