Can You Reduce Interest Rates on Your Loans?
By Brenner Spiller & Archer, LLP | May 25, 2017
Loans often carry with them prohibitive interest rates that can make paying them back very difficult. No matter how much is paid, it seems that the loan simply doesn’t reduce. Be it for a mortgage or personal loan, this spells trouble for the person paying the loan if their financial situation changes. But it doesn’t have to. In many cases, it’s actually possible to reduce the interest rates on your loans.
How an Interest Rate Reduction Works
If you are seeking a lower interest rate, the lender will re-evaluate your loan based on your financial situation. They may take into account your debt to income ratio, income, and/or employment status to temporarily lower your interest rate. In some cases, it may be possible to permanently lower your interest rate, but this is largely at the discretion of the lender.
Lowering the interest rate of a loan is often a win-win situation for both parties involved in light of harsher actions, such as bankruptcy or foreclosure, which could be far costlier to carry out. It’s a solid compromise that allows you lower payments and allows the lender continuous, timely payments.
Getting Your Interest Lowered
There are various steps in the process of having your interest lowered. The first step is to gather evidence of your current financial situation. This means pay stubs, bank statements, large bills that prevent you from making timely payments and more. Having these documents available adds strength to your case, and is often requested by the lender before they will even consider a rate reduction.
Many lenders have a process in place to handle this kind of request. Whether or not their process is easy is a different story. This is where professional help can really bolster your case. Having an experienced lawyer fight for you can make this otherwise difficult process much more streamlined.
If you are currently facing a difficult financial situation, trying to avoid bankruptcy or foreclosure, and are looking to lower the interest rates of your loans, contact Brenner, Brenner, and Spiller today to schedule a consultation.