Bank offering a loan modification

[NY1]

Filed for BK and my bank has contacted my attorney and has offered a 2% loan modification. What exactly does this mean? So i assume my rate will drop by 2%. How exactly does this work?

1. Is there any re-financing involved or does my mortgage rate just change and my payment would drop?

2. Does this affect my credit at all?

[debtinohio]

Most likely it drops to 2% total for some X period of time like 5 years, then either goes up a little bit each year or something like that. If it's for 30 years, it's a good deal depending on the value of the home v. what you owe and if you really want to stay.

No, it does not affect your credit.

[jlmaca]

Filed for BK and my bank has contacted my attorney and has offered a 2% loan modification. What exactly does this mean? So i assume my rate will drop by 2%. How exactly does this work?

1. Is there any re-financing involved or does my mortgage rate just change and my payment would drop?

2. Does this affect my credit at all?

2% sounds good for 5ish years then a market increase... I'd immediately contact my attorney and sit down and go over this mod agreement so you fully understand the ramifications. Know what you're getting into. You must know if your payments drop which I would assume with a rate drop.

Your credit is already basically destroyed for awhile by Chap7. The next hit would be a foreclosure which is sounds like you are trying to avoid. Anything less than that I would think would be insignificant on your credit.