Home Loan Modification

February 23, 2016

Struggling to pay your monthly mortgage may have you considering a home loan modification. Modifying your mortgage can help reduce your monthly payments. It doesn’t matter if you are in default or bankruptcy, and it is an alternative to foreclosure. Only certain terms of your home loan can be modified and you must qualify. Also, be aware of scams that target people whose homes are facing foreclosure. If you are considering a home loan modification, Ziegler Diamond Law: Debt Fighters serving Tampa Bay and Clearwater Florida can provide you with a free consultation.

Terms of Home Loan Modification

The terms of each modification vary. The following are examples of terms of mortgage modification:

  • Capitalization of arrears – take the back payments and put them into the loan
  • Rate reduction – reduce the loan’s interest rate in the short term or for the life of the loan
  • Extension of the term of the loan
  • Forbearance of principal – moving part of the principal to the end of your term


There are schemers that make it their business to prey upon homeowners facing foreclosure. There are 3 main types of mortgage modifications schemes:

  • Lease-buyback – Homeowners turn over their lease with the option to buy it back later on down the road.
  • Equity stripping – The schemer assumes ownership of the home then cashes out all equity on the home while charging the original owner rent. The homeowner gets evicted and loses their home.
  • Consulting service – In exchange for a fee, a firm claims they can renegotiate terms of a mortgage. In most cases, they don’t even contact the lender.

There are laws in all states to prevent operation of these home loan modification scams. However, they are complex and resources are limited. To identify schemes, look for companies charging a fee upfront and a guarantee they can stop the foreclosure. No organization can make that promise.


There are few other things to be aware of when applying for a home loan modification. Certain financial criteria is analyzed in order to qualify. These criteria include but are not limited to:

  • Loss of income
  • Increase in living expenses
  • Non-dischargeable debts

Because these criteria and others may come up, it is important to seek legal counsel.

Tackling a home loan modification on your own is daunting. Ziegler Diamond Law: Debt Fighters serving Tampa Bay and Clearwater Florida can help you. We will assist you in gaining a better understanding of your options. Don’t wait, call today for a free consultation at (727) 538-4188 or fill out our contact form online.

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About the Author

Ziegler Diamond Law: Debt Fighters, provides effective legal services to consumers in Clearwater, Florida, and throughout the Tampa Bay area who are facing home foreclosure, unmanageable debts, debt collector harassment, or other debt-related problems.