by haytham fox
Question by pete6356: What is the difference between mortgage refinancing and mortgage modification?
Answer by iam5foot2
Refinancing – is starting again… the current outstanding balance is calculated based on the selected term – it is possible to increase the balance for a ‘cash out’ situation IF (big if) there is enough equity in the property.
Modification – is usually a ‘short term’ solution, requiring the applicant meet certain criteria. The principal balance remains the same, but for a period of time the interested rate is changed (modified) to help (in theory) those in need retain their home – this does not allow cash back
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