Effective March 2002, the standard fee for a Principal Reduction Modification is $500-$1,000, which is subject to change. The fee must be submitted up front, and is non-refundable.

To find out if your loan is eligible for a Principal Reduction Modification, call us at 1-800-822-5626 and ask for our Special Loans Department. Please note, your loan must be at least 6 months old before being considered for a Modification.

If applicable, a Principal Reduction Modification can be executed within 12 months from the time a borrower applies a lump sum of $10,000 or more to the principal balance of their loan. The interest rate and term of the loan will remain the same. The loan is reamortized or 'recast' based on the lower balance. The loan must have investor approval before this transaction can be completed. Most private investors will not allow a modification to the loan.

A letter of request must be submitted stating that you would like to have your monthly payment reamortized. The letter and the fee should be mailed to:

PNC Mortgage

Attn: Special Loans/Modifications

PO Box 1820

Dayton OH 45401-1820

The lump sum principal payment is usually included, but can be made at any PNC Bank, if preferred. Once the principal balance has been reduced, a Loan Modification Agreement is prepared and sent to you for your signature. Once we receive the signed document, we update our database with your new payment amount, and send you new payment coupons.

To find out if your loan is eligible for a Principal Reduction Modification, call us at 1-800-822-5626 and ask for our Special Loans Department. Please note, your loan must be at least 6 months old to be considered for a Modification.

There is a six to eight week processing time before the new payment becomes effective. However, you will have the benefit of paying less interest immediately, so any payments made after the principal has been reduced and before the new payment amount becomes effective, results in more of the funds going to the principal balance of your loan.