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does a loan modification affect your credit score?

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October 31 2009 - Cincinnati
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Yes it will affect your credit score.  The reason is that under the trial payment period, you are not making payments according to the original Note.  Therefore, the lender can and usually will report you as being late.

Once the modification is completed, some lenders are actually indicating that they will go back and actually append the credit back to normal.

Expect a hit of approximately 100-150 points downward.  Once completed, it would take approximately 18-24 to get the credit back on track.

For more information and/or help just CLICK on my profile.
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November 01 2009
The lates you have before the workout still do damage.  If you are on a trial period and get the full modification, you may be reported as paying on terms and have no damage only after the final deal is completed. The fact that you had a loan modified may or may not be indicated in years to come..... 
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October 31 2009
If you are late on your mortgage payment or do not pay your full mortgage payment then your credit is negatively impacted.  So, this means in most cases if you accept a trial loan modification and you are paying less then what your original loan was, then you will get a deragotary on your credit report.  So, if you sign up for a 3 month trial then you will be late for 3 months eventhough you have made a mortgage payment, but it is usually less then your original contract.

Now if you are not in a trail mod and pay your mortgage on time then you are fine.  But if you are ever late or don't pay the full amount then you will get hit with a late on your credit.
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October 31 2009
 
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