what is a loan modification

A Loan Modification
What is a Loan Modification

Retire On Track LLC.

A Loan Modification to Get Rid of Unsecured Debt?

In the land of home loans, a loan modification is a process by which individuals or a financial attorney (or other consultant) working on their behalf focuses not on refinancing the debt, but on restructuring the loan itself. Rather than refinancing, in which a new loan is taken out in order to pay off the initial mortgage, a loan modification allows borrowers to restructure their payments, reduce the amount of interest that they are paying and to make other permanent changes to their mortgage without undergoing the process of getting approved for a new loan and paying a new round of closing costs.

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A loan modification model is beneficial to those who are trying to get rid of unsecured debt as well - and that's why there are non-profit debt consolidation companies that are ready and willing to work with consumers who are looking for the chance to take control of their finances. Rather than letting your debt control you (or just keep you up at night with thoughts about how you will be able to pay your bills on time), you'll find that it is possible to focus on changing the way that you use credit.

By partnering with a debt consolidation company that lets you work with someone who will learn about your debt, help you to identify what you can afford to spend and then work with your creditors to reduce the amount that you owe, you'll find that you are able to change your financial situation. When you work with a non-profit company that will negotiate with your creditors to reduce the amount of your monthly payments, reduce the rate of interest that you are charged, reduce the amount that you owe and bring your accounts current, you'll find that it's possible to restructure your payments.

When you change your payment structure, it's like getting a loan modification that helps you to get rid of your unsecured debt. Rather than swapping the debt you have for a new unsecured loan, you will be paying off the same creditors - just with the help of a credit counseling company. Rather than borrowing more, you will simply be able to reduce the amount that you owe - and to know that you've established a schedule for completely paying off your debt while learning new habits that will ensure that once you are debt free, you are able to stay that way. Knowing that you are working with a professional who regularly arranges these situations - someone who knows whom to talk with a creditor's office and what to say to work out a better arrangement - will ensure that you are able to benefit from the situation. Rather than trying to get rid of your unsecured debt with something of a loan modification on your own, having that experience gives you a tremendous advantage. Not only will you be better able to work out the right arrangement, but also you will be able to access the tools that you need to stay in control of your finances.

Try Bob's free retirement calculator - The retirement calculator was featured on 'The Saturday Early Show' by CBS' top financial analyst just click the blue button below. Take control and reach your retirement goals and connect to a trusted financial advisor near you.

 

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