It is very easy to slip up with paying the mortgage. One late payment and things can go out of hand and your mortgage can be way ahead of your paying capabilities. Then what, put your house into foreclosure? Nobody wants that, which is why most banks offer several methods in which you can repay the debt and keep the house.
The options you may have will depend on several things; one of the things that can greatly influence your situation is your credit history. With good credit history you can ask for a refinancing loan as you will be a customer that the bank can trust and they will probably provide you with one.
If your credit score is not so good the only option you have to keep the roof over your head is loan modification. This is very similar to refinancing loans, but in this case you don’t take out a second loan, you modify the existing one until both parties are satisfied.
You and your bank can modify almost every part of your mortgage loan until both parties feel that they have come to an agreement that is beneficial for both. So you can expect to change anything from the actual payment amount, to interest rates and the length of the loan. In some cases it may even be possible that your lender, whether a private lender or a bank, will be willing to forgive a small portion of your mortgage loan resulting in a lower amount of the total loan.
However, this is not something you can negotiate successfully without a lawyer, so the first thing you should do in this situation is finding a good mortgage and finance lawyer that will get you through this tough situation. After all, without an expert in this field you may end up with an even harder loan to deal with.
By Martin Fisher