5. Modify the Loan
Modifying the loan is a great solution for those who aren’t able to refinance their loan, but also in need of lowering their monthly house payments. Unlike a refinance, a loan modification requires a hardship.
Pierce says borrowers must show the lender that as a result of a financial hardship, they are not able to continue making the regular monthly house payments. “This process involves extensive paperwork that must be completed and sent to the lender for review,” says Pierce.
She actually recommends that homeowners get counseling through a HUD-certified organization in order to understand all the options and get help contacting the lender. “However, not all lenders offer loan modifications or may just offer short term loan modifications,” says Pierce.
