The Coming Foreclosure Crisis
By L. Jed Berliner, Springfield Bankruptcy Attorney on May 1, 2007 in Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, General Bankruptcy Information, Life After Bankruptcy, Massachusetts, Mortgages, Personal Finance, Role Of The Lawyer
We are already reading horrible foreclosure statistics. It will get worse, predicts Christopher Cagan, director of research and analytics for First American CoreLogic as reported at Bankrate.com. Adjustable rate mortgages issued between 2004 and 2006 will have their interest rates reset, with many mortgage payments doubling, causing a one-in-three chance of losing the home.
If you have a recent adjustable rate mortgage, there is a strong likelihood that you have no equity and the new payments will not be affordable. The absence of equity may be true even with a recently obtained fixed mortgage. Proceed with caution in attempting to save your home through a Chapter 13 filing. You may be better off surrendering the home, filing for Chapter 7 protection from any mortgage deficiency (and other debts), renting for far lower monthly payments and saving for a real down payment in two years when you can get a new mortgage.
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