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Loan Modification Agreement Example

If you are struggling to keep up with your mortgage payments, a loan modification agreement may be the solution you need. This is an agreement between you and your lender that changes the terms of your existing mortgage in order to make it more manageable for you. The new terms could include a lower interest rate, longer loan term, or a change in the type of loan you have. Below is an example of what a loan modification agreement may look like.


Borrower: [Your Name]

Lender: [Lender’s Name]

Loan Number: [Loan Number]

Property Address: [Property Address]

Effective Date: [Date]

This Loan Modification Agreement (“Agreement”) is made and entered into by and between Borrower and Lender.

WHEREAS, Borrower obtained a loan from Lender secured by the Property;

WHEREAS, Borrower is currently experiencing financial difficulties and is unable to make the current monthly mortgage payment;

WHEREAS, Lender is willing to modify the terms of the loan in order to help Borrower keep the home and make affordable monthly payments;


1. Interest Rate: The interest rate on the loan will be reduced from [current interest rate] to [new interest rate].

2. Monthly Payment: The monthly payment will be reduced from [current monthly payment] to [new monthly payment].

3. Loan Term: The loan term will be extended from [current loan term] to [new loan term].

4. Late Fees: All late fees and penalties will be waived.

5. Default: Borrower agrees to remain current on all payments under this Agreement. Any default will result in the loan modification being revoked and the original terms of the loan being reinstated.

6. Credit Reporting: Lender agrees to not report any negative credit information during the term of this Agreement.

7. Signature: Both parties have read and agree to the terms of this Agreement.

Borrower Signature: ____________________ Date: _____________

Lender Signature: ____________________ Date: _____________

This is just an example of what a loan modification agreement may look like, and the actual terms of your agreement may differ depending on your specific situation and negotiations with your lender. It is important to carefully review the terms of the agreement before signing and to seek the advice of a qualified professional if needed.

In conclusion, a loan modification agreement can help you avoid foreclosure and keep your home. If you are struggling to make mortgage payments, consider reaching out to your lender to explore the possibility of a loan modification.