Understanding Foreclosure

What is Foreclosure?

Foreclosure is the legal process by which a lender takes possession of a mortgaged property when the borrower fails to make payments. It can begin after just a single missed payment and typically involves several stages that lead to the eventual sale of the property.

How Does Foreclosure Work?

The foreclosure process varies by state, but typically involves notification to the homeowner, a period in which to cure the default, a public auction or sale of the property, and, ultimately, eviction if the homeowner does not leave voluntarily.

Potential Strategies to Avoid or Delay Foreclosure

Several strategies can potentially delay or stop the foreclosure process, including selling the property before the foreclosure sale, seeking a loan modification, or filing for bankruptcy, which may trigger an automatic stay on the foreclosure proceedings.

Deciding on Bankruptcy

Bankruptcy Basics

Bankruptcy is a legal process that provides relief to individuals struggling with debt by discharging or restructuring what they owe. Chapter 7 and Chapter 13 are the most common types of bankruptcy for individuals, each with its specific advantages and requirements.

The Pros and Cons of Bankruptcy

Bankruptcy can offer a fresh financial start, but it also has significant drawbacks, including the toll it takes on your credit score and the potential loss of assets. Understanding these trade-offs is vital in making an informed choice.

Eligibility and Filing Criteria

Eligibility for different types of bankruptcy is determined by your income, expenses, and the nature of your debts. The filing criteria range from completing a credit counseling course to meeting asset-exemption requirements.

Preparing for Foreclosure Proceedings

Consulting with a foreclosure attorney is highly recommended, as they can provide you with the legal defense you’ll need to challenge the foreclosure. Understanding your state’s foreclosure laws and deadlines is also crucial.

Gathering Necessary Documentation

Documentation such as your mortgage agreements, payment history, and any correspondence with your lender is essential in building a defense. Reviewing these materials will also help you spot any errors that could work in your favor.

Exploring Alternatives

Before the gavel falls, exhaust all potential remedies. This includes communicating with your lender, learning about loan modification options, and potentially even participating in foreclosure mediation programs if available in your area.

Bankruptcy Filing and Beyond

Bankruptcy law is dense, and court procedures can be complicated. A skilled Yuba City bankruptcy attorney will guide you through the process, ensuring that your rights are protected and that you follow the necessary steps.

The Automatic Stay

One of the most significant benefits of filing for bankruptcy is the automatic stay, which halts most creditor actions, including foreclosure. Understanding what is and isn’t affected by this stay can help you plan your next steps.

Life After Bankruptcy

Rebuilding your financial life post-bankruptcy is a detailed process that often involves budgeting, credit repair, and learning from past financial mistakes. This section will provide a roadmap for the steps you can take to secure a healthier financial future.

The path through foreclosure and bankruptcy is riddled with twists and turns, yet it’s not an insurmountable challenge. Armed with knowledge, strategic preparation, and post-legal recovery plans, navigating these tumultuous waters can lead to a brighter financial future. By methodically evaluating your options, seeking professional guidance, and committing yourself to the recovery process, debtors can steer their way through these hardships towards a more stable and secure economic horizon.

The federal funds rate is important because it determines the cost of borrowing for banks. When the federal funds rate goes up, the prime rate goes up, and when the prime rate goes up, mortgage interest rates go up.

Why is the Federal Reserve raising the Federal Funds Rate?

The Federal Reserve is raising the Federal Funds Rate because they want to keep inflation under control. Inflation is the rate at which the general level of prices for goods and services is rising and, consequently, purchasing power of currency is affected by this rate. Inflation is caused in part by an increase in the money supply. When the money supply grows faster than the economy, prices go up.

When the economy is growing too quickly, inflation can become a problem. The Federal Reserve boosts interest rates to control inflation, which slows down the economy. In an effort to keep the economy from overheating, the Federal Reserve is also taking action. Inflation and asset bubbles can both result from an economy that is developing too quickly. Asset bubbles occur when the value of things like stocks and real estate rises excessively before falling. By hiking interest rates, the Federal Reserve is attempting to prevent an asset bubble.

How will increased mortgage rates affect sellers?

The effect of increased mortgage rates on sellers depends on the market conditions at the time. If the demand for homes is high, sellers may not be affected. However, if the demand for homes is low, sellers may have to lower their prices in order to attract buyers.

How will increased mortgage rates impact home buyers?

The impact of increased mortgage rates on home buyers will vary depending on the buyer’s financial situation. Those with good credit and a large down payment may not be affected as much as those with bad credit or a small down payment. The main concern for most home buyers when mortgage rates increase is the impact it will have on their monthly payments.

For example, a 1% increase in interest rates would increase a monthly mortgage payment by approximately $100 on a $200,000 loan. Buyers with pre-approved credit and fixed interest rates are not affected by higher mortgage rates. However, buyers who have not yet locked an interest rate can increase their monthly payments if the interest rate rises before the loan closes. Generally, when mortgage rates rise, it becomes more difficult for buyers to buy a home. This can reduce the number of buyers in the market and lower prices.

What should borrowers do if their mortgage rate is too high?

If a borrower feels their mortgage rate is too high, they should reach out to their lender to explore their options. It is possible to refinance a mortgage to get a lower interest rate. A borrower can refinance their mortgage by taking out a new loan with a lower interest rate and using the proceeds to pay off their existing mortgage.

Can higher mortgage rates cause more foreclosures?

There is no single answer to this question as it can depend on many factors. In general, higher mortgage interest rates make it harder for borrowers to pay their monthly payments, which can lead to more foreclosures. However, other factors, such as unemployment or falling property values, may also play a role in the increase in foreclosures. For more information about foreclosures or debt management of any type of loan, call a Sacramento bankruptcy attorney today at 916-459-2364

A foreclosure is the legal process by which a lender, typically a bank, takes back possession of a property after the borrower has failed to make loan payments. The bank then sells the property in an attempt to recoup its losses.

Foreclosures can be lengthy and expensive processes and often lead to the displacement of the property’s occupants. There are three types of foreclosure: judicial, non-judicial, and power of sale. Judicial foreclosures are handled by the courts, while non-judicial foreclosures are processed outside of the court system. Power of sale foreclosures are the most common, and occur when the lender has the power to sell the property without going to court.

The foreclosure process begins when the borrower misses a payment. The lender will then send a notice of default, which informs the borrower that they have failed to make a payment and that the lender intends to take back the property. The borrower then has a set number of days to cure the default, which means to make up the missed payment. If the borrower fails to cure the default, the lender will proceed with the foreclosure.

What are the options to stop a foreclosure?

There are a number of options available to homeowners who are facing foreclosure. In some cases, the homeowner may be able to work out a payment plan or modification with the lender. However, lenders are not obligated to negotiate or modify conditions on a loan. For some lenders, it may be more cost effective to pursue the foreclosure and lose money than to negotiate. In other cases, the lender may find it beneficial to halt a foreclosure and work with the debtor on repayment terms.

For many people facing foreclosure, filing for bankruptcy protection is the fastest way to stop a foreclosure and secure assistance in creating a workout plan with the lender. The foreclosure process can be quick and complicated, which is why time is of the essence when dealing with foreclosures. If you are at risk of losing your home, contact a Sacramento bankruptcy lawyer today to review your options.

A mortgage loan modification is a process where the terms of a mortgage are changed to make the payments more affordable. This can be done by extending the term of the loan, reducing the interest rate, or both. It may also change the structure of a loan such as an adjustable to fixed rate loan.

Mortgage loan modifications became more popular during the housing crisis of 2007-2008 as many homeowners found themselves unable to make their mortgage payments. The federal government established the Home Affordable Modification Program (HAMP) in 2009 to help homeowners modify their mortgages.

Are mortgage modifications still available?

Yes, but not with as many options as before. Currently, you can only secure a mortgage modification through your lender directly. Every lender is different and many may not be willing to work with you or change your loan conditions. Lenders do not have any obligation to accept a request for mortgage modification even during financial hardship.

Can a loan modification stop a foreclosure?

It depends on the situation. If the homeowner is able to make modified payments that are within their budget, the homeowner can apply for the foreclosure process to freeze. However, if the homeowner is not able to make the modified payments, the foreclosure process might continue.

There are many different types of mortgage loan modifications, so it is important to consult with a qualified attorney or financial advisor to see if you qualify for a modification and to understand the different options available to you. Contact an Elk Grove bankruptcy attorney for more information about mortgage modifications and options to stop a foreclosure.

It is not uncommon for people who have fallen into financial troubles to take out a second mortgage on their home. Often people take a second mortgage to lower their monthly payments or to free up additional credit within the loan to make modifications to the home they cannot afford out of pocket. In the case of financial hardship, this does not work and merely delays the process of filing for bankruptcy as a debt relief option.

Second Mortgage, Second Chances

During a bankruptcy proceeding, homeowners may be able to get rid of a second mortgage or a home equity line of credit. This is referred to as lien stripping. There are various requirements that must be satisfied in order for the mortgage to be discharged. What must have happened is that the home’s value has been decreased to the point that any equity that has been built up in the home is no longer sufficient to secure any of the second mortgage balance. To prove this, an appraisal must show that the house’s fair market value is so low that if you sold it, you wouldn’t be able to pay off the second mortgage. On the other hand, if it turns out that even a little portion of your equity is sufficient to secure collateral on a second mortgage, you will not be allowed to discharge this debt in bankruptcy.

The risk of foreclosure on a single or double mortgage comes with far more headache than many people realize. Whether seeking financial help through a Chapter 13 or Chapter 7, the process can be quite complex. It is always advised to seek the counsel of an Elk Grove bankruptcy lawyer to assist you in making the best informed decision for you and the protection of your home.

For most people, a mortgage is linked to their most expensive asset; and debt. If the debts owed on your home become too high of a financial burden to bear, you have a short window to seek help for your missed payments before losing the home.

Foreclosures 101

Foreclosure is a legal process by which mortgage lenders can take a property from a homeowner that has defaulted on their loan. Typically, the foreclosure process can last from one to seven months, depending on the state you live in. However, there are situations in which a mortgage lender may begin the foreclosure process after the first missed payment. Through the foreclosure process, the lender can evict your family when it sells the home to satisfy the mortgage you owe.

Although the foreclosure process can be swift and severe, there are options for resolving outstanding mortgage debts. But time is ticking on the clock of debt resolution.

Foreclosure Solutions

There may be a couple of options that can be taken to get you out of this trouble. It may be that you need to file for bankruptcy if none of the other options like loan modification is available to you. It may be that you have let your situation go too long and the foreclosure sale is eminent. It is not too late to file for bankruptcy and stop the sale as long as the sale hasn’t already taken place.

An automatic stay will be put into effect immediately. This is like an injunction that won’t allow the mortgage holder to proceed or to continue trying to collect. The lender could also petition the courts to lift the stay so they can continue with their actions. This may be successful but it will stall the foreclosure proceedings. It will at least buy you some time to seek out other possible alternatives. There may be a possibility your loan holder will give you a loan modification, which are few and far in between, but it is worth asking. If you do seek out a loan modification you will probably have to call every day and get them to answer your questions. People have had success in asking for a modification to lower the interest rate and reduce the payments. They have also received the modification even after declaring bankruptcy.

Both the foreclosure and bankruptcy process are not for the faint of heart. They both require the help of an experienced attorney. Contact an experienced Sacramento bankruptcy attorney today to discuss your options for keeping your home while resolving your debts.

Getting behind on your house payments can happen to the best of us. Whether job loss, medical costs, or other life stressors have led you down a road to mortgage debt; there are solutions that can resolve your problems with mortgage debt.

Foreclosure Or Bankruptcy?

There are two general types of foreclosures — judicial and non-judicial. Most mortgage loans are secured by a lien on your home. In a judicial foreclosure, the lender files a complaint in court asking for a judicial foreclosure. If the lender wins, the court orders your home sold at an auction. The proceeds of the sale go to the lender to pay off the mortgage debt. In a non-judicial foreclosure, the lender uses a power of sale clause in the mortgage. The clause allows the lender to sell the property in a non-judicial foreclosure. The lender must follow the procedures required by the mortgage loan documents and state law. If you have a mortgage loan and can’t pay your mortgage, you may want to consider the benefits and drawbacks of a judicial foreclosure. There are, however, benefits of a judicial foreclosure. The lender must go through the court process, so the foreclosure process takes longer. All foreclosure procedures are strictly followed by the lender, and the lender must wait to file a foreclosure complaint until after the loan is more than 90 days delinquent. The drawbacks of a judicial foreclosure include giving up the house and any equity you have in it and the borrower can be left with liability to the lender even after the sale completes.

If you file a bankruptcy case to reduce your debt after a property has been sold at a foreclosure sale, you might be able to eliminate liability to the lender that remains after the sale. However, you may want to consider your options before the lender forecloses. You may be able to sell your home to a third party or negotiate a payment plan with the lender prior to the sale date. In addition, homeowners can utilize chapter 13 bankruptcy to catch up the arrears on the mortgage when filing prior to a lenders foreclosure auction. Most chapter 13 reorganization plans provide for as much as sixty months to repay the missed payments. However, the homeowner also needs to consistently pay the regularly monthly payments on the mortgage that arise in the future during the chapter 13 case.

If you are suffering with missed mortgage payments or the risk of foreclosure, contact our Elk Grove bankruptcy attorney office today to discuss your options. Missed mortgage payments can quickly lead to foreclosure, which can turn into a financial disaster overnight. Don’t wait another day to find out how to stop foreclosure and resolve your mortgage debt today.

For most people, a mortgage is their most expensive asset and largest debt. If the debt owed on your home becomes too high of a financial burden to bear, you have a short window to seek help for your missed payments before losing the home.

Foreclosures 101

Foreclosure is a legal process by which mortgage lenders can take a property from a homeowner that has defaulted on their loan. Typically, the foreclosure process lasts several months, depending on the state you live in. However, there are situations in which a mortgage lender may begin the foreclosure process after the first missed payment. Through the foreclosure process, the lender can evict your family after sell the home to satisfy the debts owed.

Although the foreclosure process can be swift and severe, there are options for resolving outstanding mortgage debts. But, time is ticking on the clock of debt resolution.

Foreclosure Solutions

There may be a couple of options to get you out of foreclosure trouble before the sale takes place. It may be that you need to file for bankruptcy if none of the other options like loan modification is available to you. It may be that you have let your situation go too long and the foreclosure sale is eminent like within a few days. Even in this situation, you might still have a chance to save your home if you are eligible to file for bankruptcy prior to the actual execution of the foreclosure sale.

An automatic stay will be put into effect immediately. This is like an injunction that won’t allow the mortgage holder to proceed or to continue trying to collect. The lender could also petition the courts to lift the stay so they can continue with their actions. This may be successful but it will stall the foreclosure proceedings. It will at least buy you some time to seek out other possible alternatives. There may be a possibility your loan holder will give you a loan modification, these are few and far between but it is worth asking. If you do seek out a loan modification you will probably have to call every day and get them to answer your questions. Some people have had success in asking for a modification to lower the interest rate and reduce the payments. They have also received the modification in some instances after declaring bankruptcy.

After you have filed a bankruptcy, you will be given a case number and eventually an estimated release date, which is your discharge and to reclaim control of your properties. In most cases, you may be able to stay in your house and continue to pay off the mortgage lender if you have continued your payments on schedule.

Both the foreclosure and bankruptcy process are not for the faint of heart. They both require the help of an experienced attorney. Contact an experienced Sacramento bankruptcy attorney today to discuss your options for keeping your home while resolving your debts.

If you are behind in your mortgage payments and worry you may lose your house to your lenders, you may want to consider filing bankruptcy. Bankruptcy can stop the foreclosure process by implementing the automatic stay, which stops most collection attempts against you.

Filing bankruptcy will not stop the foreclosure process forever, and it will not relieve you of the obligation to make your home payments. It will, however, give you some time to attempt to figure out what you want to do with the home and how to get your finances in better shape.

Eliminate Debt

If you do not want to keep your home, you can surrender the property to the lender and cancel any remaining mortgage. You will also be able to eliminate all other qualifying debt in bankruptcy, such as credit cards, medical bills, payday loans, and late utility bills.

If you do want to keep your home, you will have three to five years to catch up on the payments. Sometimes you can even restructure your loan as part of the bankruptcy process, making it easier to make the payments in the future. You will also need to keep current on your house payments if you wish to keep the collateral.

Credit Rating

If you are worried about your credit rating if you file bankruptcy, remember a foreclosure will not be any more favorable to potential lenders. The difference will be that you will get to keep your home if you wish when you file bankruptcy.

If you are behind in your mortgage payments and need some time to figure out how to proceed, contact a Sacramento bankruptcy attorney to discuss your options.

Insolvent consumers who are not able to stay current with their mortgage payments may face foreclosure proceedings from their mortgage lender. Due to the number of California foreclosure avoidance measures available to you, avoiding these mistakes will help steer you in the right direction toward defense against foreclosure.

Waiting too Long to Take Action

Waiting too long to defend a home against a California foreclosure is the single biggest mistake that individuals make when facing a looming foreclosure. If you take only one thing away from the article, it should be that there are options available to prevent a foreclosure.

Neglect to Call Your Mortgage Lender

While it may seem that your mortgage lender would not be interested in negotiating your mortgage contract, it is in their best interest for you to continue maintaining the home and making payments. Your mortgage lender can help you file for a loan modification, and therefore, should be your first call in defense of a foreclosure. Even if your lender refuses to modify your existing loan, California Foreclosure law can prevent initiating a foreclosure while your application is pending.

Foreclosure Rescue with Upfront Fees

Foreclosure rescue companies that require an upfront fee to receive housing counseling or to apply for a mortgage assistance program should be avoided. There are plenty of services offered for free if you are facing foreclosure. The US Department of Housing and Urban Development provides free, HUD-approved housing counseling, which can provide you with details on the initial steps in avoiding foreclosure.

Fail to Consider a California Bankruptcy

Some consumers feel that once they receive a notice to proceed with foreclosure of their home, they might as well give up the home. If you desire to remain living in your home, nothing could be further from the truth. Not only can filing for California bankruptcy protection immediately halt your foreclosure, but a Chapter 13 bankruptcy can also allow you to spread out mortgage arrears over a period of three to five years, giving you valuable time to get caught up on payments.

Bankruptcy lawyers in Sacramento, California have the unique ability to utilize the US Bankruptcy Code to ensure your right to debt relief. Avoid these California Foreclosure mistakes beforehand by contacting a bankruptcy attorney in Sacramento who will fight to prevent your foreclosure and safeguard your legal rights.

When you file Chapter 7, all property in your name will enter into what’s called your bankruptcy estate. A Bankruptcy trustee will be assigned to sell all nonexempt property in your estate to pay back your creditors. If you have a second home, and live in a state that has a wild card exemption, you may utilize this to cover equity in your vacation home. A wild card exemption is essentially an extra exemption that you can use to protect a certain amount of property of your choosing. States have amounts and rules regarding wildcard exemptions, therefore you’ll want to ask your bankruptcy attorney if your state has a wildcard exemption and if so, which option will give you the highest dollar amount in exemptions.

When attempting to find out if you will be able to keep both homes in a Chapter 7 bankruptcy, you should obtain recent appraisals or comparative sales analyses and then subtract the balance of loans and liens on the properties. Once the equity is calculated from your second home, the trustee will determine to sell the house or not depending on if there will be enough money left over after deducting the costs associated with selling the property, the trustee’s commission, paying you your exemption, and paying off liens associated with the home. If the trustee believes that selling the home will still produce the money to pay your creditors back they will most likely sell the second property.

The exemptions that can be used to save your vacation home in Chapter 7 bankruptcy differ from state to state. Because of the complexity of the bankruptcy laws combined with the enormous implications of your decision-making during the bankruptcy process, you should definitely obtain the services of an experienced Sacramento bankruptcy attorney where you file. This will not only help ensure that your debts are discharged at the conclusion of the bankruptcy, but also ensure that you keep your vacation home if it is possible.

Understanding Second Mortgage in Bankruptcy

Since the decline in the real estate market over the past decade, many homeowners have to bear the brunt of their mortgage. In most cases the mortgage being higher than the current worth of their house. In such cases, the homeowner will be required to pay back a second or third mortgage as a junior lien in lieu of the deficiency. However, in chapter 13 bankruptcy, you have a tool called lien stripping. This can help you get rid of your second mortgage. The US bankruptcy Court orders the lender to withdraw its lien on your property. In other words, your second mortgage (which is a secured debt) is converted to an unsecured debt just like your credit card debt.

However, you can opt for lien stripping of your second mortgage. This can be done when your first mortgage exceeds the market value of your property. In Chapter 13, the second mortgage on your house is treated as a non-priority unsecured debt. This is treated just like your credit card or medical debt. This implies that you will be required to make only a partial payment towards your second mortgage in chapter 13. Once the chapter 13 plan is dismissed, the balance due on your mortgage is also automatically discharged.

If you have filed for a chapter 13, you automatically get the benefit of not having to pay for a second mortgage. A lean stripping would be able to provide the homeowner with some relief since he/she will be saved from paying the additional amount.

Mortgage loans

A mortgage is a home loan that a bank or a lender gives you to make it possible for you to buy a home. Once you agree to the terms and the property is signed over to you, the bank will hold a certain lien over the property that you bought. That means, even though the property is yours, the bank will hold a certain amount of interest over it. It is done to make sure that the bank doesn’t lose money if you stop paying your EMIs. The mortgage supplying company will have this lien on the property till the payments are completed.

Bankruptcy Effects on Mortgages

Filing for bankruptcy, especially a chapter 7, where all your assets are liquidated, you are no longer legally obligated to repay your loans. But that being said, you still do owe the lender money and the lien that the lender holds on the property still stands. So, even if you don’t legally have to pay the loan, the mortgage supplier can take hold of the property. The idea is to keep the home, so, if you do have to file for bankruptcy, make sure you speak to your lender beforehand and work out a settlement procedure that lets you keep the house and you keep paying your loan. With a chapter 13, you will not lose your house, but you will have to chart out a repayment plan.

If you are facing foreclosure or worried about your mortgage payment, contact a Sacramento bankruptcy lawyer to discuss your options.

Mortgages After Bankruptcy

The first thing to know is that time heals, especially when it comes to your credit. You should wait at least a year or two before attempting to apply for a mortgage after a bankruptcy filing. This provides time for you to work on rebuilding your credit and prove to lenders that you are not a borrowing risk by establishing a solid payment history on credit accounts.

Next, start the planning process early. While you are working on your credit profile you can also start saving for a down payment. The more you can offer to put down at closing, the more likely a lender is to see you as a favorable borrower. Work towards saving 20% of what your loan is going to cover at closing before applying for a mortgage loan.

When your credit standing has been repaired and you have saved enough for a sizeable down payment, shop lenders. Just because you have filed bankruptcy in the past does not mean that you don’t deserve a good loan with favorable terms. Since not all lenders are equal, speak to several different companies and find out what they are willing to offer you. Compare your mortgage offers and look for the one with the lowest, fixed interest rate with the best conditions.

Before you buy a home, take the time to follow some important steps to reduce your chances of mortgage debt trouble.

First, know how much you can truly afford before home shopping. Financial experts recommend keeping your mortgage payment to 25% or less of your total monthly income. Once you calculate an appropriate payment amount you can shop within your range.

Second, include an estimate in your mortgage budget for additional costs like insurance, taxes, and repair costs. These expenses should be factored into the overall cost of your home.

Third, only shop for homes in the range that you calculated to carry a mortgage payment of less than 25% of your income. Taking a quick look at homes above your range puts you at risk of overspending.

If you already own a home and are worried about mortgage debt, follow these steps to maximize chances of keeping your home out of foreclosure.

First, set up an automatic withdrawal of your mortgage payment through your bank. This ensures that you don’t accidentally miss a payment. If you don’t think you will be able to make your payment for any reason, don’t let the payment lapse on purpose. Cut expenses elsewhere and contact your lender.

Second, don’t wait to contact your lender. If you think you may soon or already have missed a payment, get in touch with them right away to discuss your options. Believe it or not, most lenders do not want the hassle of the foreclosure process either. Lenders are often willing to help you develop a plan to ensure you can make your payment or get caught up on missed payments.

Third, always work with a professional when negotiating with mortgage lenders. Contact a bankruptcy lawyer in Sacramento to discuss your options for resolving mortgage debt. You may be able to modify your existing loan or eliminate other debts through the bankruptcy process while you continue your mortgage loan payments.

How to: In House Modification

In-house mortgage modification, or dealing directly with your loan servicer to modify your existing mortgage is often the first recommend step in a successful mortgage modification. In the wake of the housing crisis of 2007, many mortgage companies have created dedicated departments to help individuals save their homes. The home preservation specialists will usually send you or be able to direct you to an application for this process. These packages will ask you to include paycheck stubs, a letter explaining your hardship, your budget, and any other supporting materials.

Once you have found out what your servicer requires and turned in the material, it’s time to follow up and be persistent. It’s a good idea to check in on the progress of your modification once or twice a week and ask if the file is complete, see if anything has changed, and ensure that documents don’t need to be resubmitted. The entire process can be a long and taxing one, but the reward is well worth the extra work.

How to: HAMP Modification

Much like an in-house modification, HAMP is designed to lower your mortgage payment to make home ownership more sustainable and affordable. The main difference between the two forms of mortgage modification is that HAMP is a government program. Because the government oversees the Homeowners Affordability Modification Program, it adheres to program guidelines that are usually less stringent than those of the loan servicers themselves.

The process to apply for HAMP is typically the same as the in-house modification: contact your lender, and supply the financial documents and they will check to see if you qualify for the HAMP. If not, they will look at other programs that may help.

One thing to keep in mind is that the mortgage companies are not your friends and they aren’t there to make it easy on you; they are there to make interest of your home loan, plain and simple. If you have attempted to modify your mortgage and been turned down as many people have experienced, you still have options. Many individuals have been able to modify their creditor payments by filing for Chapter 13 bankruptcy which takes into account all your assets and liabilities and allows you to structure a payment plan through the courts. By filing for bankruptcy you can IMMEDIATELY STOP FORECLOSURE proceedings and give yourself time to plan your repayment over the course of 3-5 years.