How to compare old mortgage to new modifed mortgage

How do I compare my current mortgage to a new modified proposal from my bank? What are the factors to look at? ( Lower monthly payment wouldn't mean much to me if it ment I am taking on more debt , in a long run, by extending loan term.)

savior70 · Posted: Fri Nov 13, 2009 3:32 am Post subject:

Hi,

A modified proposal may not be beneficial in the long run. Your payments would be reduced and you will be able to afford the monthly payments. But in most of the cases, the loan is modified by extending the term of the loan. In case the term is extended, you will end up paying more in interest in the long run. Hence, unless the monthly payments are reduced considerably, the modified proposal will not be very effective.

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