Posted By: LizzyP
Balloon Modification - 08/12/14 07:55 PM
We have Balloon notes coming due and just want to extend the note with no changes to payment or APR. Just wanted to make sure that this would be a true Modification and no new disclosures would be required? Am I correct in stating this?
If you don't replace the loan with a new loan, it's a modification. IOW, you'll type up an agreement that:
1. References the loan being modified;
2. States what's changing, and
3. Says something like "All other terms and conditions remain the same".
This document cannot legally stand on it's own. It goes with the prior loan to gain a full understanding of the terms. That's not a refinancing.