Loan modification vs refinancing
It is tough to make a blanket statement and declare that either loan modifications are better than refinancing or vica-versa, but it is safe to say that both options are better than foreclosure.
Both loan modifications and refinancing is going to set you back a few thousand dollars in fee when it is all said and done, so that is a “push”.
Refinancing is a good option if you have a variable interest loan and you want to “lock in” a fixed rate loan. Interest rates are very low for the time being, so refinancing makes sense for people that are meeting there monthly payments as well.
Loan modifications are more for people that are facing foreclosure and do not have many other options as far as their house goes.
Like I said earlier though, both are favorable to doing nothing about your situation and ending up in a foreclosure.