If you are finding you are needing your 1st mortgage modification, you are not alone. Take a look at this informative article about the 1st mortgage modification, and find out how this program can affect you.
A 1st mortgage modification will no doubt be a whirlwind of new information for you. Nevertheless, if it allows you to prevent foreclosure and to keep your house and possessions, it may well be worth it. Some of the things involved in 1st mortgage modification are; Capitalization & Re-amortization, a lowering of interest rates, extended amortization, a partial forebearance of the principal, and a test called an “NPV”. The NPV is ” Net Present Value Comparison “, and has to do with the overall value of the loan modifications.
The 1st mortgage modification is determined by preset conditions outlined in the above attributes of this mortgage loan modification program. Such things as delinquent interest, taxes, lawyer fees, and other things are factored in. It is very possible that unpaid late charges can be waived, which is good news. The 1st mortgage modification will hopefully start a decrease in the interest rate to as low as three percent. This decrease is accomplished in increments, but will go up again after five years.
The 1st mortgage modification has the effect of delaying the payment of the principal when the loan itself is paid in full. This option is not currently available for those who have had a Freddie Mac or Fannie Mae loan. This year as the option arm loans start to balloon in their payments the 1st mortgage modification will more than likely need to be presented to many homeowners in the USA. Look at this as an option to avoid foreclosure and bankruptcy. Creditors are decreasing their desire to foreclose anyway because of the way the price of housing has fallen. This is good news and if you truly need a 1st mortgage modification, it will more than likely be a welcome option.