Chapter 22 - The Residential Mortgage Market
Loan Modifications Agreements
are designed to assist troubled borrowers avoid
foreclosure, remain in a home, and save the lender the costs of foreclosure and
They may also result in additional fee income for the mortgage lender.
Loan modifications usually add any missed loan payments to the remaining
balance the borrower still owes on a home, and a new payment schedule is worked out.
Many such agreements lower the required monthly mortgage payment somewhat by
stretching out the maturity of the loan. Modification agreements have noticeably slowed
11. What are the advantages and disadvantages of home refinancings? Under what
circumstances should a homeowner consider refinancing a home mortgage?