Long Island foreclosure lawyers and bankruptcy attorneys are reporting that they are finding a large increase in the number of people consulting them about loan modifications. The need for loan modifications is understandable, given the current economic climate.  Also the fact that financial institutions are realizing that while loan modifications may result in a lowering of their profit margins, are willing to accept this as being better than no profit or even a loss.

 

When a borrower defaults on loan repayments and the property is foreclosed everyone involved loses. The borrower has lost his house and financial institution is left with a property that will be next to impossible to sell at a profit. Lenders are not interested in the property – their business is to make profits from lending money.

 

If banks and finance companies are willing to offer loan modifications as a way of avoiding foreclosures, what’s the problem? Shouldn’t the homeowner just grab anything that may ease the financial burden and give them a chance to keep the house? Unfortunately it’s not quite that simple.

 

Even when they have no choice but to ask for loan modifications, the financial institutions will try to attain the maximum benefit they can from the revised terms. There’s nothing wrong with that – it is their job to make money where they can. But what seems to be benefiting the homeowner may not be the full picture. Let us take just one example given by the NACBA or the National Association of Consumer Bankruptcy Attorneys – when loan modifications are done, less than 10% of the modified loans result in the principal loan balance being reduced. What may seem to be a benefit may not really be. Since it is a business negotiation, homeowners should always negotiate for the best possible repayment terms they can get.

 

It seems the residents of Suffolk and Nassau Counties are discovering the complexities of loan modifications now being offered and negotiated. That is why consulting a Long Island foreclosure lawyer has become an important part of any loan modification discussion. A Long Island foreclosure lawyer will understand the long term implications of the modifications and advise you what is in your best interest and what is not. With expert legal advice, you can negotiate the best possible loan modifications.

 

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This entry was posted on Monday, May 18th, 2009 at 7:19 am and is filed under General Information. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.