Well, coming to the point, let's tell you what is loan modification and how it is helpful in stopping foreclosure.
What is loan modification?
The term explains its meaning itself; loan modification is the process in which the loan terms are modified to do some favor for the homeowner. The homeowners need to approach their mortgage lenders for this and the lenders modify the original loan agreement by decreasing the interest rate, by reducing the amount of monthly payment or by expanding the loan term, to make it affordable for the homeowners.
It depends on your lender that whether your loan modification would be approved or not. But if you approach him soon after you miss a payment or are expecting to miss a payment, by showing him the proof that you are going through financial hardships which will be fixed soon.
How it helps to stop foreclosure?
Undoubtedly, the loan modification is one of the most preferred ways to stop foreclosure in Houston, that not only take the homeowners out of this situation but also helps them keep their home. However, it highly depends on when you approach your lender and how relevant is your reason for the inability to pay the mortgage payment.
Furthermore, you are always recommended to be honest with your lender that why you would not be able to repay the loan as he will ask you for the proof. Also, as the loan modification will offer you a new repayment schedule for your payment, you need to have an estimate that what amount you would be able to pay so that the lender can modify the terms accordingly. Most of the lenders are willing to help the homeowners as foreclosure not only costs them more money but also needs a lot of work to be done from lenders' side.
Thus, a loan modification will definitely stop the foreclosure of your house provided that you are not applying for it a few days before the foreclosure sale date. You need to act soon if you want the loan modification process work for you. For proven and better results, you can seek the help of an experienced foreclosure agent in Houston as they are well versed with all these processes.