Distressed homeowners trying to learn about the loan modification process are finding themselves frustrated and confused. Are you wondering whether a loan modification may be the answer you are looking for to help avoid foreclosure? If so, then you need to learn about the process so you will know how to qualify and what to expect. To help you learn the basics, here are the Top 10 Questions and Answers about loan modifications:

1. What does "loan modification" mean exactly? By definition, a loan modification is a permanent change in one or more terms of a home loan that results in a more affordable monthly payment. A delinquent loan is brought current, and the interest rate may be lowered, a longer term offered and sometimes a reduction in the principle balance. A successful loan modification should offer the homeowner an affordable and sustainable monthly loan payment.

2. Will I have to pay all the late fees & penalties? Most lenders are offering modification programs that waive the late fees and penalties. Always ask for a detailed accounting and description of all fees from your lender-some fees may not be justified or allowable and should be waived.

3. I can't afford to bring my loan current-can my missed payments be added back in to the loan? Generally your lender will allow your missed loan payments to be added into the new loan balance and spread out over the term to make it affordable. Some lenders may require the first months new loan payment as good faith for the new loan modification.

4. How can I find out if I will qualify for a loan modification with my lender? The #1 requirement your lender is looking for is proof of your ability to pay the new loan payment now and in the future. When you provide your lender with properly completed financial statements, you prove to your lender that you can afford the new payment.

5. I am not late yet on my payments-but I am struggling and foresee a problem-can I still get a loan modification? Yes, the Federal Government is strongly encouraging lenders to reach out to all borrowers with adjustable rate and option arm loan programs now before they go into default. If you see a problem continuing to make your payments, don't wait; contact your lender to start the modification process. Bear in mind, the homeowners already in default will receive assistance first. You need to be persistent to get the loan modification process started.

6. What qualifies as an acceptable hardship situation? Generally, if you have experienced a severe change to you financial situation due to divorce or separation, medical issues, military service, death in family, loss of job or transfer, natural disaster your lender will consider your modification application. However, each situation is unique and viewed on its own merit. A well written, compelling hardship letter will help your bank determine your situation and intentions.

7. Will a loan modification stop foreclosure? Yes, that is the purpose of the loan modification. Your loan is immediately brought current upon completion of the loan modification process.

8. Will the lender need to do a physical inspection of the interior of my home-do I have to let them? Yes, the lender may conduct an interior inspection of your home if they feel it is necessary as part of the loan modification process.

9. What fees are involved? Can I do it myself? No, there are no fees involved in a loan modification when you work directly with your bank. There is no escrow, title or appraisal required. You certainly can work directly with your lender to find a loan workout solution. Just make sure you have a good understanding of the modification process-once you know what your bank needs to see to approve your application, you can prepare your paperwork properly.

10. So, how do I get started with the loan modification process? Simply fill out the contact form on the right, and Foreclosure Shield will begin the process of saving your home from foreclosure today!