All Home Affordable Loan Modification program approval decisions are not uniform. Each decision to approve a loan modification is considered on a case by case basis. Even with the financial incentives that the federal government has offered to participating mortgage lenders, lenders still have the final decision as to whether your loan modification request makes enough financial sense to them to approve your request.

If your mortgage lender decides to approve your mortgage modification request they will lower your mortgage payment via the following methods:

• They will first look at lowering your mortgage loan interest rate,
• Then, they will look at extending or recasting your mortgage to a longer term like 40 years, and
• As a final option, they will look at reducing the amount of principal balance that your mortgage payment is based on, but still holding you responsible for paying the full principal amount into the future when your mortgage is paid off with either a resale or refinance.

Each of these options are designed and used in conjunction with each other if necessary to get your mortgage payment to somewhere between 31%-38% of your gross monthly income. Your mortgage payment equals your principal, interest, taxes, insurance, PMI, and homeowners association payments. Gross monthly income is the amount of money you make on a monthly bases before your taxes and other deductions are removed from your paycheck.

For more information about the Home Affordable Modification Program and other options you may have to stop foreclosure speak with one of our specially trained real estate agents.