Changing the Terms of Your Loan

Changing the Terms of Your Loan

Slide1As we get into the holiday season, you might find your bank account dwindling. The holidays can be more difficult financially, and this may be especially true for homeowners, recent graduates, etc. If you’re in this situation, you might consider a loan modification to help make ends meet. Some loan modifications are government sponsored programs with terms and conditions already established, which might include conditions of eligibility. Often, these do not offer much flexibility, but might save your home.

Possible loan modifications include (among others) lower monthly payments, lower interest rates, or loan term extensions. These types of modifications can be arranged by working with a loan lender or servicer, a certified housing counselor, or a company who is licensed to provide loan mediation services.

If this seems like something you might be interested in, you’ll first need to gather some information. Get your financial documents in order—contact information for your lender, proof of recent payments, and bank statements are a good place to start. You’ll also probably need pay stubs, a recent tax return, recent utility bills, record of homeowner association dues, and income and expense information.

Next, you’ll need to contact your lender, servicer, or both. If they’re unable to help, it might be time to go on to step two, which is to contact a certified housing counselor. This individual is trained to work with you to determine loan modification eligibility. In some cities, these services are provided at little or no cost. Begin looking for a professional by contacting your state Department of Commerce.

Also, don’t hesitate to check out government sponsored loan modification programs, such as the Making Home Affordable Program, meant to assist struggling homeowners. Though this option might mean adhering to certain rules, it can help ensure your financial stability for years to come.

Finally, Jason Hartman encourages you to consider enrolling in a program designed to improve financial literacy and help you make sound investment choices. These programs are occasionally offered for free through a public library or extension office, or may come with a fee, depending on the program. Either way, they’ll offer an excellent look at financial literacy opportunities for you and future investment options. If you’ve already got an investment portfolio, you might learn about ways to diversity your investments.

Fear not—there are options that await you! By educating yourself and working with your lenders, you’ll be on your feet again in no time. (http://www.flickr.com/photos/pnwra/1504270898/)

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