Posted on: 07th Nov, 2012 10:42 pm
I have read that some people are getting approved loan modification and some have balloon payments at the end. Does all HAMP modification have balloon payments? What does a balloon payment exactly mean? Does this mean at the end of lets say a 30 year term you would owe the remaining balloon payment?
Hi Jack!
Welcome to forums!
In case of a loan modification, the lender lowers the interest rate in order to make the payments affordable for the borrower. Such a lower rate may remain for the whole term of the loan which might increase your loan term. Or else, it will remain effective for a certain period of time, after which you will be liable for paying a lump sum amount in order to pay off the balance debt amount.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
In case of a loan modification, the lender lowers the interest rate in order to make the payments affordable for the borrower. Such a lower rate may remain for the whole term of the loan which might increase your loan term. Or else, it will remain effective for a certain period of time, after which you will be liable for paying a lump sum amount in order to pay off the balance debt amount.
Feel free to ask if you've further queries.
Sussane
Hi Jack,
As far as I can understand, after the end of the 30 year term, you will be liable for paying the balloon payment to the lender.
Thanks
As far as I can understand, after the end of the 30 year term, you will be liable for paying the balloon payment to the lender.
Thanks