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hi im brooks bassan and i work with nexon pruitts financial institutions and creditors rights practice groups when a business loan is delinquent or in default but theres still the potential to right the ship two options a lender may consider in resolving the problem loan a loan modification or forbearance agreement youve heard the term troubled debt restructuring or tdr this is when modifications and forbearance agreements are used for starters lets do a quick comparison of the two the loan modification its what the name implies it modifies the original terms of an existing loan such as extending the term of the loan or lowering or raising the interest rate or adding additional collateral if the loan is secured a loan modification is not a refinance renovation the existing loan is not paid off or replaced with a new loan the terms that are not modified remain in place unchanged loan modifications are typically permanent the term that is modified remains a permanent change to the