What happens after a trial period in loan modification?
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Video answer: Loan modification- you got the trial period! now what?
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- A loan modification is a permanent change to the terms of your loan. If you are applying for a loan modification through the federal Making Home Affordable program, you must complete a three-month trial modification period. You must make all payments during your trial modification on time.
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What Happens After a Trial Period in Loan Modification? By Jeannine Mancini The modification can reduce your monthly payment by such measures as lowering the interest rate, extending the length of the loan and forgiving part of the principal.
A trial period offers a borrower immediate payment relief, while the lender processes information and documentation provided by the borrower to determine if it can offer a permanent loan modification. It also gives the borrower an opportunity to ensure that he or she has the ability to afford the lower monthly mortgage payment.
The trial period offers you immediate payment relief while we process the paperwork to determine if we can offer you a permanent loan modification. It also gives you time to make sure that you can manage the lower monthly mortgage payment.” Notice that the lender didn't promise to give that homeowner a permanent loan modification.
The modification trial period serves two purposes. It gives the lender a first-hand look at your ability to afford the modified payment, and it gives you and the lender time to finish the...
At the end of the three-month trial period, the loan modification may not be accepted The time frames above are still in effect Depending on the loan program and AUS findings, you may be required to demonstrate more than 12 on time payments Example, for an FHA manually underwritten loan, your housing payments need to be one time
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