In most instances when a Law Office negotiates with the lender or loan servicing company they can achieve much lower interest rates fixed for up to 40 years at rates around 5.00%. If the home is upside down an Attorney that offers loan modifications can push for a principal forbearance or forgiveness. In addition, they can also get the lender to forgive or recapitalize the arrearages. We have seen many cases where a borrower is as much as one year behind in their mortgage payments and the house is upside down, the attorneys get the arrearages pushed to the back of the loan or waived completely. The mortgage loan servicing company gets paid fees from the investor for trying to collect on a loan that’s in default so why would they want to negotiate when they keep getting paid more for bad loans? The truth is a loan modification attorney will bring a law suit to their attention by either the investor or the borrower. The truth is that with the new laws passed an investor can sue the servicing company if they foreclose and the investor looses more than they would in providing a loan modification, even with a huge principal reduction. When it comes to sub prime loans we have seen lenders drop the rate from 11.00% to 6.00% fixed for 40 years. With all the California, Arizona, Nevada and Florida home owners stuck in “option ARM “ loans we have seen fixed interest rates as low as 2.25% to 3.25% for 3 to 5 years then stagger 1.00% per year until they reach 5.00% or so. Allowing borrowers in risky loans to keep their home at a much lower interest rate! Most of these loans have RESPA and TILA violations anyway and an attorney can make it very difficult for them to foreclose anyway. If you are getting harassed from your lender and led to think you will get foreclosed on if you don’t accept their offer you should know your rights. The bottom line is the loan servicing company has an attorney and so should you or you might get foreclosed on when you could have received a loan modification at a below market interest rate and saved your home from foreclosure.