What is Re-Amortization?

So you’ve missed a few payments and the bank has sent you several letters letting you know that unless you start making amends, they’re going to foreclose. Again, remember communication with your lender is key because neither one of you wants to go through a foreclosure because no one wins… the bank just loses less.

A re-amortization is exactly what it sounds like, they recalculate your loan after adding your missed payments onto the principal of the loan. What this does is it will increase your payments because your total debt has increased and it’s an option the bank will take if you can show that the payments you missed were temporary and that you can make these new payments. They won’t re-amortize if you’re going to just miss the new payments and fall down that slippery slope once again.