Loan Restructuring
Loan restructuring modifies original mortgage terms through negotiation with lenders, addressing financial hardship or changing circumstances by adjusting payment schedules, interest rates, or loan duration.
| Restructuring Types | Modification |
| Term extension | Reduce monthly payments, increase total interest |
| Rate reduction | Temporary or permanent decrease |
| Payment holiday | Defer payments 3-12 months |
| Principal forbearance | Pause principal, continue interest |
| Debt-to-equity | Convert debt to lender ownership |
| Eligibility Criteria | Requirements |
| Financial hardship | Job loss, medical, business failure |
| Property status | No default exceeding 180 days |
| Communication | Proactive lender engagement |
| Documentation | Comprehensive financial disclosure |
| Long-Term Impact | Consequence |
| Credit rating | Negative mark for 2-3 years |
| Total cost | Usually increases overall interest |
| Future borrowing | More difficult for 3-5 years |
| Foreclosure avoidance | Primary benefit |
Related Terms
RERA licensed advisors
Free expert advice
Get property recommendations matched to your goals. No pressure. No commitment.