What is the difference between revision and novation?

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I recently got help from my bank on my mortgage loan as they were willing to do a modification. However, i was originally in a negative amortization loan and now to help us keep our house, the bank is willing to help with a 18 month interest only deal. The wording on the signature part said that ” this Agreement is only a revision and not a novation. please help explain what that means in legal term. and my obligations thereafter the 18 months,. i’m most concern about it going back to a negative amortization situation after the 18 months. thank you for your time.

1 Comment
  1. Reply
    April 29, 2011 at 10:26 pm

    A novation would replace the terms of your loan. A revision simply revises your original terms. An example of a novation is when the obligation to pay is transferred to someone else.

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