What is Mortgage Restructuring?

A homeowner applies for a mortgage loan restructure in order to obtain a more affordable monthly payment. A mortgage restructure occurs when the borrower and lender work together to plan new repayment terms on an existing mortgage.  As your bankruptcy attorney in Chicago, Illinois, Thomas W. Drexler, will assist you in your application for a mortgage restructure and answer any questions you may have.

Key Information

The government put programs in place to allow individuals to modify their mortgage if they meet certain qualifications. Restructuring a mortgage is different from refinancing in that you do not need to replace your current mortgage – the terms are just adjusted.

One major benefit of restructuring your mortgage is that some lenders will push a portion of your principal balance to the back of your loan payment.  Restructuring your mortgage will also lower your monthly payments, keep your current interest rate and help to avoid possible foreclosure in the future.


The first qualification is that you must have a stable income. Lenders look at your income while they review the mortgage restructure application. An individual needs to have sufficient income to cover the new monthly payment, and you need to be able to prove this income.  In addition, this must be a recurring income that you can prove, rather than a lump sum.

The next qualification is proof of financial distress. Lenders are more willing to grant restructures to homeowners who are in financial distress for legitimate reasons.  A loss of income due to death, disability, serious medical condition or temporary unemployment are all common reasons for a restructure.

In general, the property must be your primary residence to be able to qualify for a loan restructure.

Contact the Law Offices of Thomas W. Drexler if you have questions regarding obtaining a mortgage loan modification.