I always wondered how does a loan modification work and if it was really a viable way to sort things out if you are behind with your home loan lender. But I never truly understood how does a loan modification work until my brother successfully got one. He didn’t have to go through any of the loan modification companies either. I asked him how the process worked and he was gracious enough to fill me in on the process, which was a lot less complex than I had imagined. Basically, he got behind on his payments because he lost his job and was laid off. By the time he found work again, it paid far less than what he was previously making and he could no longer afford his monthly payments. He called the bank and let them know why he was behind. They connected him with their loss mitigation department who was quick to evaluate his situation. A few weeks into the process they decided that they would modify his loan, lower his interest and lower his monthly payment.
