Make sure that loan modification agreement gets recorded

I recently had a client who had been paying on a modified loan for a year, yet discovered that the foreclosure was proceeding anyway. It was a case of the left hand not knowing what the right hand is doing, and it could have been much more easily resolved if that loan modification had been recorded.

A loan modification is one of the tools that can be used to stop or avoid a foreclosure, but it has to be handled correctly. This is a document that changes the terms of the original mortgage, which is a document that is recorded in the county clerk’s office in order to protect a lender’s right to foreclose if you don’t pay as agreed. That’s why it’s essential that a loan modification be recorded, as well. If a borrower is paying as agreed according to the modified loan, but only the original mortgage is on record, then what happened to this client is possible.

Loan modifications are complicated documents, and signing one without attorney advice can lead to headaches, including this one. If you are being offered a loan modification, call Selby Legal to learn what’s required to get an attorney experienced with loan modification agreements in your corner.