A Loan Modification is the process of working out a permanent, equitable, and fair solution between you and your lender that eliminates or reduces current debt you have incurred from a bad mortgage. It involves a procedure whereby a loans payment plan is altered due to the hardship of the borrower. This can include the rate, term and monthly payment amounts. This is handled by an attorney and the lenders Loss Mitigation Department.

FMS can help you to modify an existing loan made by a lender in response to a long-term inability to repay the loan. IT would involve a reduction in the principal balance, interest rate or an extension of the length of the term of the loan. A lender might be open to modifying a loan because the cost of doing so is less than the cost of default or foreclosure.