Millions of distressed homeowners fear that a letter from their bank stating they are in pre-foreclosure is the beginning of the end. They sometimes begin to make arrangements to move 60 days before the foreclosure is to take place.

Instead, that letter should be a signal to the homeowner to search for options. Of course, the homeowners knew they had difficulties for months and even years preceding this point. Illness, loss of income, divorce and other circumstances generally create an accumulation of debt that builds gradually. But if the homeowner can show that they have a stream of income of some sort, they should be able to work things out with the bank. Their option includes approaching the bank to see if they can recast the mortgage terms.

Of course, few people are capable of negotiating with banks on their own. This is why many turn to loan modification professionals – lawyers and financial people – to do those negotiations for them. As experienced experts who have knowledge on what a foreclosure costs a bank, the loan modification team can recast the terms of the mortgage that enable the homeowner to retain ownership, stay living in the house and with reduced monthly payments through a lower, locked-in interest rate.

Loan modifications work on a pre-approval basis: they examine a case before taking it on, and if unsuccessful, they return the fees to the homeowner in a money-back guaranty.