How Can I Modify My Home Loan Terms?

Can I reduce my loan balance? My house is not worth what I owe on it. Can I re-appraise my house and reduce my mortgage payment, interest rate and mortgage balance? Those are the questions that homeowners hit by staggering economy and collapse of the financial markets ask.

In today’s home pricing situation modification of an existing home loan terms seems like a viable option that will help homeowners stay in their home, avoid foreclosure and continue making mortgage payments to the lender or the bank.

On Monday, October 6, 2008, associated press reported that Bank of America settled law suits over bad mortgages.

Bank of America said it will modify home loans to help keep homeowners from foreclosures homes.

Bank of America has agreed to pay more than $8 billion to modify home loans to keep people from foreclosures. Bank of America will modify existing home loans with up to $8.4 billion in interest rate and principal reductions for close to 400 thousands customers of Countrywide

Financial, the mortgage lender that Bank of America acquired last summer.
The Illinois attorney general's office said Sunday that Bank of America was to modify loans for its borrowers in 11 states.

Some borrowers stuck with Countrywide Financial borrowers may qualify for interest-only loan for the next ten years. Even people who can't afford to continue making their mortgage payments in the staggering economy and continuing growth of unemployment will be able to get help moving to a new home.