What if there is NO Equity and/or the Property is Underwater?

Loan modification is still possible! Some banks will agree to a principal reduction. Getting a lender to agree to write off money owed is very difficult, we are seeing some of these results, BUT this is done on a case-by-case basis and is the least likely solution the lender will agree to. Essentially the borrower is asking the lender to pay part of the loan for them and take a loss.