The March jump in foreclosure activity(35% over February) is seen by many as a sign that lenders are coming to grips with the documentation problems that led to the robo-signing scandal last fall. Meanwhile, private mortgage loan modifications were up significantly in March while the government’s Home Affordable Modification Program (HAMP) rates have not been updated as of today.
What to do if you can’t get a mortgage modification
Most people DO NOT successfully modify their mortgages. There are too many built-in incentives for mortgage companies to deny them. We’ve said before that those facing foreclosure might, under certain circumstances, be able to keep their homes through a Chapter 13 bankruptcy filing.
Where an individual is on the verge of losing their homes or vehicles, filing a Chapter 13 bankruptcy can halt the process. The court will issue an automatic stay and will then restructure the debts so that mortgage and car payments become more manageable.
By lowering the interest and reducing monthly payments, Chapter 13 bankruptcy provides a way to catch up on payments.
If you are behind in making your mortgage payments, but you still have income and can pay the monthly mortgage payment, a bankruptcy counseling session will help you determine whether Chapter 13 or some other strategy is in your interests. Call our offices today.