Oklahoma City Lawyer Guiding Clients Through the Loan Modification Process
If you take out a loan, it is your responsibility to comply with its terms until you have repaid the lender. But a lot can change over the course of a long-term loan. It’s possible that the terms that you agreed to when you initially secured the loan may no longer work for you in the future. If you are unable to make payments on a loan, it’s important to understand how you can seek financial relief.
The loan modification attorneys at Mitchell & Hammond have helped thousands of clients in Oklahoma City take control of their finances by obtaining more favorable loan terms. Schedule a free consultation with our team to learn more about the loan modification process and whether or not it’s right for you.
What is Loan Modification?
Loan modification is the process of negotiating the terms of your initial loan agreement with your lenders. The goal of this process is to make the loan payments more affordable for the debtor to ensure they can continue paying off the loan. Some of the most common modifications include:
- Reducing the interest rate
- Extending the length of the loan to lower the monthly payments
- Converting an adjustable-rate loan to a fixed-rate loan
- Letting the debtor pay arrears towards the end of the loan
- Deferring some principal payments
These are some of the many changes that can make a loan more affordable. The exact modifications that are made will vary on a case-by-case basis.
Who is Eligible For Loan Modification in Oklahoma City?
Each lender has its own eligibility requirements for loan modifications. If you are behind on loan payments or in danger of falling behind in the near future, an attorney can contact your lender to learn more about their eligibility requirements. But in general, debtors must be able to prove that they have suffered some type of financial hardship that has affected their ability to comply with the terms of the initial loan.
The Benefits of Negotiating A Loan Modification
There are a number of benefits to modifying a loan’s term, including:
- Modifying the terms makes the debt more manageable so you can afford monthly payments moving forward.
- In many cases, loan modification can help debtors avoid bankruptcy.
- Loan modification can help debtors protect their homes and prevent foreclosure.
- Loan modifications, foreclosures, and bankruptcies will all negatively impact your credit score, but loan modification has the smallest impact so it is easier to rebuild your credit.
- Modifications can help debtors stay current with payments during rough times in their lives.
There are pros and cons to every financial relief option, so talk to an experienced bankruptcy attorney to learn more about the loan modification process. An attorney will be able to determine if a loan modification is the most effective way to get your finances back on track.
Can You Modify Your Loan After Filing For Bankruptcy in Oklahoma?
Loan modification is typically seen as an alternative to bankruptcy. This means most debtors attempt to resolve their financial problems by modifying their loans in an effort to avoid bankruptcy. But it is possible to negotiate a loan modification after you have already filed for bankruptcy. In fact, filing for bankruptcy will trigger an automatic stay, which will temporarily prevent creditors from attempting to collect debts from you. Many debtors take advantage of the automatic stay’s temporary protection and use this time to negotiate loan modifications with their lenders.
If you modify a loan after filing for Chapter 13 bankruptcy, the court will need to approve the modification. The court will usually approve loan modifications as long as the new terms are fair.
So although loan modification is often an alternative to bankruptcy, do not rule out this option simply because you have already filed for bankruptcy. Modifying a loan after filing for bankruptcy can still be beneficial.
Schedule A Free Consultation With Our Experienced Loan Modification Attorneys in Oklahoma City
If you are unable to make payments on your loans, contact the loan modification attorneys at Mitchell & Hammond as soon as possible. Our skilled attorneys are committed to helping our clients overcome their challenges and achieve financial freedom.
We will carefully review your finances to determine if loan modification is the answer to your financial troubles. If it is, we will work tirelessly to negotiate with your creditors to secure more favorable terms. To schedule a free consultation, call the attorneys at Mitchell & Hammond at 405-216-0007 or submit your information via the form on this website.