Loan Modification Appraisers and Services
When a homeowner and a lender are involved in a possible loan modification of a property’s mortgage, the lender will typically request that the homeowner obtain an appraisal of the property. If a homeowner has designated an attorney to handle the loan modification process, the attorney will also need to know the property’s current market value and submit an appraisal to the lender. Loan modification appraisers play a pivotal part within the loan modification process. The lender’s decision to approve or deny the request for a loan modification is reliant on the quality and accuracy of the appraisal. Domus Appraisals is well experienced in performing loan modification appraisals. Our knowledge of the process and of the lender’s expectations has assisted many homeowners in obtaining approvals within the loan modification process.
What is a Loan Modification?
A loan modification is a modification to an existing loan made 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 might be open to modifying a loan because the cost of doing so is less than the cost of default.
A loan modification agreement is different from a forbearance agreement. A forbearance agreement provides short-term relief for borrowers who have temporary financial problems, while a loan modification agreement is a long-term solution for borrowers who will never be able to repay an existing loan.
What is a Loan Modification Appraisal?
Obtaining a loan modification appraisal is one of the first steps to be taken in the loan modification process. Once the value of the property is known, the lender will begin to review the possibility of a modification to the existing mortgage. In many cases, if the value of the property has decreased then the risk to the lender to modify the loan has increased. When the property value has increased, it is usually easier for the lender to approve a modification. Even if the property value has decreased, the lender may still opt to modify the loan. It is more cost-efficient to the lender to modify a loan than to allow the property to foreclose.
Loan modifications can result in lowered monthly payments making repayment of the loan more affordable for the homeowner. A loan modification may also be in the best interest of the lender if restructuring the loan will help avoid foreclosure of the property.
Do You Need a Loan Modification Appraiser?
When going through the process of modifying your current mortgage, place your trust in the experts at Domus Appraisals. We deliver fast, accurate appraisals which provide your lender with all of the information they will need to initiate the loan modification process. Call us today at 1-866-939-5979 or fill out a contact form.
