Ditech Loan Modification
If you are struggling to make your monthly mortgage payments, you may be looking for a way out. A ditech loan modification can offer you relief from your current situation, preventing you from becoming delinquent on your home. There are two options that can be explored in this circumstance: selling the home and entering into a modification agreement with the lender. Both of these options have their own set of benefits and risks, and it is important to look at both before entering into any agreements.
Selling your home is an option, but there is some negative that comes along with it. First of all, you will need to come up with the cash to do so, and this will mean that you aren’t actually improving your financial situation at all. In addition, selling your home will affect your credit for years to come, making any type of credit improvement difficult or even impossible. A loan modification program, on the other hand, will provide you with a permanent, positive change to your financial situation while saving your home from foreclosure and providing you with peace of mind and a chance to learn and grow financially.
benefits of a ditech loan modification
With a modified loan, you will be able to refinance the loan at a lower rate with reduced payments. The new lower payment is usually between six and nine percent lower than your current monthly mortgage payment. Modifying the terms of the loan will also stop foreclosure, allowing you to save your home from repossession. To qualify, you must demonstrate severe financial hardship that has arisen due to your inability to pay your loan. The lenders will evaluate your income and expenses to determine if you qualify. Modifying your loan will require that you contact your existing lender and discuss the terms of the modified loan program.
You can get started with a loan modification program as soon as the loan becomes past due. Any late fees and accrued interest will be added to the balance of your loan, increasing your total debt, and thus your monthly mortgage payment. To be eligible for the Ditech loan modification, you must be living on the property that you are currently renting. Modifying the terms of your loan does not eliminate the debt associated with the property, so you will have to pay it off or find alternative arrangements.
If you are considering a Ditech loan modification, it is wise to work out all of the details beforehand. You will want to know how much your monthly payments would be, and what your new monthly payment will be. You will also want to find out the impact any changes to your loan will make on your credit score. Working out all of these details ahead of time will help you make an informed decision about your financial future.
A Ditech loan modification is not right for every homeowner. If you have experienced a financial hardship, this type of loan program may not be the best option for you. In order for the loan modification program to work, you must demonstrate extreme financial hardship beyond what has previously occurred. This means proving that you can not afford your current mortgage payments, or your new mortgage payment is unreasonably high.
Related: Ditech Foreclosure