No, they are not the same. A refinance replaces the existing mortgage with a new loan with a lower rate, and/or more favorable terms, such as a fixed rate loan versus an adjustable one. It is a more permanent solution than most loan modifications, and usually offers greater advantages. A loan modification is when a lender discounts (reduces) the principal balance of a loan because you pay it off early, oragrees to a loan modification (a “workout”) thatincludes a reduction in the principal balance ofa loan, the amount of the discount or theamount of principal reduction is canceled debt. See Why did I get a 1099-C from my mortgage company? Related information:IRS Publication 4681 CanceledDebts, Foreclosures, Repossessions, and AbandonmentsCan I exclude my 1099-C from my taxable income?How do I enter a 1099-C?

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Is a home loan modification the same as refinancing your home?

Forum|Forum|7 years ago
June 1, 2019
3 replies
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No, they are not the same.

A refinance replaces the existing mortgage with a new loan with a lower rate, and/or more favorable terms, such as a fixed rate loan versus an adjustable one. It is a more permanent solution than most loan modifications, and usually offers greater advantages.

A loan modification is when a lender discounts (reduces) the principal balance of a loan because you pay it off early, or agrees to a loan modification (a “workout”) that includes a reduction in the principal balance of a loan, the amount of the discount or the amount of principal reduction is canceled debt. See Why did I get a 1099-C from my mortgage company?

Related information:

Anonymous

Answer

No, they are not the same.

A refinance replaces the existing mortgage with a new loan with a lower rate, and/or more favorable terms, such as a fixed rate loan versus an adjustable one. It is a more permanent solution than most loan modifications, and usually offers greater advantages.

A loan modification is when a lender discounts (reduces) the principal balance of a loan because you pay it off early, or agrees to a loan modification (a “workout”) that includes a reduction in the principal balance of a loan, the amount of the discount or the amount of principal reduction is canceled debt. See Why did I get a 1099-C from my mortgage company?

Related information:

ezme777

Level 2

I was just and a loan modification and I received a cancellation of debtI need to know please how do I file this H&R Block are having a hard time figuring out if I owe money or if I'm exempt or excluded I need help please thank you