Finance
Vermont's 'loan modification' option for distressed borrowers allows:
AOnly interest rate reductions
BChanges to the original loan terms (rate, term, principal) to make payments affordable and avoid foreclosure✓ Correct
CComplete forgiveness of the mortgage balance
DTransfer of the mortgage to a new borrower
Explanation
A loan modification restructures the existing mortgage terms — reducing the interest rate, extending the term, or modifying principal — to make payments more affordable for a borrower in financial hardship, often as an alternative to foreclosure.
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