What is a Loan Modification and How Can I benefit?

a loan modification is a permanent change in one or more of the terms of a mortgagor's loan, it allows the loan to be reinstated, and results in a payment the mortgagor can afford. a modification is made to an existing loan by a lender in response to a borrower's long-term inability to repay the loan. loan modifications typically involve a reduction in the interest rate on the loan, an extension of the length of the term of the loan, a different type of loan or any combination of the three. a lender may be open to modifying a loan because the cost of doing so is less than the cost of default.