As opposed to a loan refinance, an Arizona loan modification is an adjustment to your existing Arizona mortgage loan, typically based on your demonstrated inability to continue paying your mortgage due to circumstances that have changed since you originally obtained the loan.
Your lender may agree to a loan modification that reduces your interest rate, locks in a fixed rate of interest for the life of the loan or an extended period, extends the term of the loan, and/or forgives a portion of the loan's principal balance. These modified terms are usually designed to reduce your monthly mortgage loan payment, thus allowing you to keep your home.
Lenders who have provided mortgages for Arizona real estate may be motivated to approve a loan modification in order to avoid even larger losses that they may incur if forced to foreclose.
