Mortgage Payments During the Loan Modification Process

Mortgage Payments During the Loan Modification Process

Richard Fonfrias, J.D.
Chicago’s Financial Rescue & Bankruptcy Lawyer
Fonfrias Law Group, LLC


The slow economy has resulted in many homeowners being unable to make their house payments.  As a result, many banks offer loan modifications to these homeowners; however, these modifications often take months to process.  What you do in the meantime, while you’re waiting for the loan modification, can make a big difference in your approval.

Your Application Process

Start by going to your bank’s website and locate the area that addresses financial assistance and loan modifications.  Go over this information carefully before you contact your bank.

Gather all of your financial records, including all pay stubs, bank statements, and expenses for the past six months.  Help your bank understand all of the steps required to get your loan modification approval.  As you can see, this process will require a lot of paperwork.  Fill out everything promptly and keep records of all communications with the lender.

Your Loan Application Approval

Your loan modification may require months before it’s approved.  Make sure you ask lots of questions so you know how the lender will restructure the loan.  For example, some banks will lower the principal amount, while others will reduce only the loan’s interest rate.

Your Loan’s Temporary Payments

Make on-time loan payments while you’re waiting for approval. Your bank rep will let you know how much to pay and the exact payment date.  Many lenders leave the payment date the same and change only the amount owed.  This payment amount may be only temporary or the full current payment.   It might not be the actual new payment when your modification is approved. Make sure you make all payments in full and on time so you don’t disrupt the process.

Your Loan Modification Approval

You may discover that your loan modification has dramatically changed your loan. Some banks create a loan with a low interest rate that increases as time passes. Other banks reduce your principal balance. Go over all your paperwork carefully. The payment due date may change, as well.  Look at the fine print so you understand all your obligations.  In this way, you’ll avoid costly fees, dings to your credit score and possible default on your newly modified loan.


You’re Invited to Call or E-mail.

“If you have questions about bankruptcy, foreclosure, credit card debt, loan modifications,

tax liens or other financial problems, please send your e-mail today to or call 312-969-0730.” — Rich

Richard Fonfrias, J.D.

Chicago’s Financial Rescue & Bankruptcy Lawyer

Money problems solved. Peace of mind protected.

Founder & Managing Partner

Fonfrias Law Group, LLC

First National Plaza v 70 West Madison Street, Suite 1400 v Chicago, Illinois 60602
Telephone 312-969-0730 v Facsimile 312-624-7954 v