Refinance Vs Loan Modification
Refinance vs Loan Modification
Arizona Loan modifications are applicable in the real estate industry when mortgage property values have declined significantly.
Due to the booming real estate economy in the late 90’s and most of this decade, not very many homeowners need to learn about the loan modification process. This resulted in many homeowners applying for a refinance. A refinance is sensible in a stable or increasing market. It offers homeowners the ability to take out cash when needed, fix or lower their interest rate, among the possible options.
The basic difference between the 2 options can be outlined on the following list. In a refinance, the borrower pays the closing cost, a refinance requires an appraisal report, requires escrow and title policy, offers a rate that is subject to current market conditions, homeowner must have a verified income, a credit score criteria must be met, and will take 1 to 2 months to complete.
In a loan modification, an appraisal is not needed, no escrow or title is required, homeowner must have a verified income, homeowners credit score is not as important, will offer a lower interest rate, and can take 1 to 4 months to complete.
When considering a loan mod vs. refinance, homeowners need to outweigh their options. Struggling homeowners need to take the time to understand their options.
Tags: arizona loan modification, foreclosure help, loan modification, loss mitigation, phoenix loan modification, preforeclosure, refinance
