Loan Modification and Short Sale as Alternatives to Foreclosure

There are two options available for homeowners who are facing deep financial stress.  They can choose between loan modification and short sale.  Homeowners should determine which one would be suitable for their situation.  A lot of homeowners naturally want to keep their properties and will likely choose loan modification.  Unfortunately, there are instances when such option is not viable and not the most ideal exit strategy.  So how can you determine if a loan modification or short sale is the best option for you?  A Comparison of Loan Modification and Short Sale To know which option is best for your situation, it is important to understand the intricacies of each.  You have to know what to expect from loan modification and short sale so that you can get a good idea of what is in store for you.  Loan modification has several benefits.  First of all, this option will enable you to keep your property.  When you modify your mortgage loan, you will be ab
le to adjust your monthly payments to make them more affordable.  However, the loan modification process can be very lengthy and frustrating.  It might take 30 to 160 days before you can see the result of your application.  Your credit might also be affected for a short period especially if you are already late on your payments.  On the other hand, a short sale works in a different plane.  When you short sell the house, your home will be sold and you have to move to another location.  The process of short selling can also take at least 60 days to 120 days.  The process can also impact on your credit because your rates will be considered settled account.  However, a government plan is available for those who wish to short sale their homes.  The government will pay them $3,000 as a moving out allowance.  The federal government program for short selling also eliminates the future liabilities of the homeowner.  Now that you know the basics of loan modifi
cation and a short sale, you have to decide which one would be suitable for your unique circumstance.  If you intend to keep the house and to hold on to it because of some reasons, then your best option is loan modification.  You have to remember that the process for loan modification can be very frustrating and confusing.  But if you will exert effort to learn and understand the entire process, then you might enjoy great results with this option.  If loan modification is not viable for whatever reason, a short sale could be your best alternative.  Short selling is a proactive way of avoiding a foreclosure.  This option would be a lot less damaging to your credit.  And the best part is that the federal government has a program that provides incentives and support for homeowners who wish to short sell their properties. Foreclosure cases are on the rise because of the continuing impact of the recession.  More and more people are sliding deep into financial h
ardship.  To avoid a foreclosure, you should seriously consider applying for loan modification or a short sale.

View this post on my blog: http://www.federalpersonalloan.com/federal-loan-programs/loan-modification-and-short-sale-as-alternatives-to-foreclosure.html