Refinance vs. loan modification

loan modification, refinanceBoth refinancing and loan modification are genuine and legal financial procedures which are availed by people who have been unable to manage their loan repayments. These financial proceedings are available with lawyers or companies. Though both bring some amount of relief from their existing loan accounts and repayments, they are different from each other on some basic grounds. Refinance is another loan which replaces the existing loan with new rates and favorable terms and conditions.

On the other hand, loan modification is not another loan. It modifies the terms and conditions of the existing loans so as to make it easier for the debtors to repay the loan amount easily and in a timely manner. Loan modification is done by a third party, preferably a lawyer, who mediates the issues between the lending agencies and the debtors. In spite of being different, both these financial services are capable of making the debtors feel comfortable.

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