Refinancing vs. Loan ModificationRefinancing vs. Loan Modification
Refinancing vs. Loan Modification
Helping troubled homeowners is our mission.
|How it affects||Refinancing||Loan Modification|
|Loan term and conditions||New loan, rate will be lower than existent, usually this term more favorable||Old mortgage terms will be modified, common change: reducing interest rate and lowering monthly payment|
|How can you enroll?||Refinancing depends on a excellent credit score, cash for the closing cost and the value of your property||Modification depends on lowering your rate and has no additional cost|
|What are the negatives?||It is harder to get a refinanced loan because if your credit score has dropped due to missed payments, it can lead to potentially higher monthly payments. In addition, considering property values, you might end up owing more than the cost of the property.||There has to be proof of financial hardship while also being able to prove you are able to pay the lower costs. In addition, there is no guarantee the bank will approve your request.|