How to Negotiate a Mortgage Loan Modification

Negotiating a mortgage loan modification allows you to adjust your repayment schedule to meet your current circumstances. When negotiating a mortgage loan modification, you have several options:

  • You can negotiate through a government-sponsored program.
  • You can negotiate through a service.
  • You can negotiate directly with the lender.

If you decide to go it alone, here's what you need to do to ensure successfully negotiating a mortgage loan modification:


  • Have the name of a reputable lawyer at hand, in case you need advice along the way.
  • Gather all the pertinent information before starting to negotiate. This includes the reason you want to make the modification and a description of the desired modifications [source: Negotiation Requirements].
  • Make sure you're financially capable of meeting and maintaining the terms of the modifications. You will have to prove your financial status by providing pay stubs, records of expenditures, a recent bank statement, and income tax returns for the past two years [source: Mortgage Loan Modification Regulations].
  • Ask your lawyer or bank about any laws, requirements or guidelines you should be aware of before beginning negotiations.
  • Prepare your terms of negotiations. Be ready to offer the lender a specific interest rate, monthly payment, number of loan payments, collateral, etc.
  • Choose an arbiter. Decide with the lender who to use as an arbiter in case the negotiations hit a snag.

Keep in mind that negotiating a mortgage loan modification is not simple. If you're not 100 percent sure you can do it on your own, it's much better to hire a reputable professional to negotiate on your behalf.