In this recession finding a solution to your financial problems is not easy. But when the problem concerns foreclosure, useful help is hard to come by. A vast majority of people were introduced with a concept which has been around for quite some time however few have heard of this option. This option is home loan or mortgage modification. It is a common phrase being thrown around in the news and on the internet, these days but few people really understand what a home loan modification really is.

A mortgage or a home loan modification is a permanent change to the terms and conditions of a loan. Its main aim is the reduction of a homeowner's monthly payment, either through reducing the principle interest rate of the mortgage, an extension of the length of the loan term, elimination of accumulated fees, grace period to help you get your finance in order, or any combination of the available options that suit you and your lender. It allows you to restructure your mortgage and results in a more affordable monthly payment.

A home loan modification is usually helpful in cases where homeowners are facing foreclosure. However, it is not the only situation in which a homeowner can apply for home loan modification. One may also apply for a home loan modification if a sizeable reduction has been made to their monthly income due to reasons beyond control. For example, one may apply for a home loan modification after a recent separation or divorce, loss of employment, death in the family or any other unexpected expanses, which might hinder the homeowner from fulfilling their monthly payment towards the mortgage. If you are late on your payments, a loan mod can also be taken into consideration. One may also use a loan mod to convert their mortgage from an adjustable rate mortgage (ARM) to a fixed rate one due to skyrocketing interest rate. By converting an ARM to a fixed rate one you can have a lower your monthly payments making them more manageable.

You can apply for a home loan modification yourself or hire a firm to represent you. If you are going through a financial crisis and cannot afford to pay a firm then you will understandably want to apply for the loan modification yourself. It is important that you understand the workings of a loss mitigation process and know what to expect and be prepared before you proceed on your own. It is important to understand the bank or lender will be aiming to protect their interest and your goal is to convince them to lower the interest rate for the loan. If you decide to hire a firm to do your loan modification you should research properly and ask for referrals. You should ask family and friends if they have gone through a similar process and have had successful results with a firm to avoid any scammers that have been targeting homeowners who are desperate to avoid foreclosure.

In any case you need to learn the in and outs of the loan modification process so you won't be trapped and given a bad deal. Understanding the subject is key towards a successful loan modification. I would recommend 60 Minute Loan Modification. This kit has helped hundreds of people reduce their mortgage payments and save their homes.