If you struggle to pay your mortgage, you can ask your lender to modify your home loan. This process, called mortgage loan modification, may provide lower payments, a lower interest rate or a combination of the two.

Explore this program to learn whether it may help you keep your home if you have excessive debt.

How modification works

Your mortgage lender has the discretion to modify the terms of your loan with your agreement. Review the terms of the proposed modification carefully. Depending on the type of mortgage you have, the lender may extend the loan term or provide an adjustable rate to achieve lower monthly payments.

Qualifying for modification

While eligibility requirements vary by the mortgage company, you must generally either be already behind on your loan payments or about to fall behind for the lender to consider a modification. Typically, the lender will ask you to show proof of a hardship that limits your ability to make mortgage payments, such as illness, disability, death in the family or job loss.

Applying for modification

If you are curious about modification, the first step is to call your mortgage provider to learn more about your options. Many lenders have existing modification programs, so you can apply directly to learn whether you are eligible.

In general, you will have to provide details about your financial hardship as well as a thorough accounting of your income and assets. Sometimes, a mortgage modification will lower your credit score, but the impact on your credit is usually less than the score decrease for a foreclosure.