Making Mortgage Relief Work for You?
By Kurt O'Keefe, Attorney at Law on Sep 12, 2007 in General Bankruptcy Information
More comments on President Bush’s proposals to ameliorate the mortgage crisis and coming recession.
Yes, restricting the ability of mortgage companies to take your home then nail you with income tax liability is a good idea. I do not see how it will help the current crisis.
The FHA changes potentially help an unknown number, but clearly a minority, of those facing foreclosure.
My favorite quote in the Yahoo finance article linked to above, from “helicopter Ben”, head of the Fed, “He stated that it’s not the responsibility of the Fed to protect lenders and investors from the consequences of their actions. ”
Heck no, we just print the money. We are not responsible for what you peons do with it.
No way to make a bubble without the money supply being pumped up. Now that it is bursting, what to do?
Bankruptcy is, and should be, a last resort.
Under the current law, bankruptcy laws do nothing to change the monthly payment on a mortgage secured by your residence.
NACBA, the National Association of Consumer Bankruptcy Attorneys, has advocated a simple change that would allow modification of such mortgages, that they could be re-written down to the current value of the home, and changed to fixed interest rates.
The losses have happened, and will worsen, as home prices continue to decline. The lenders, or their bankruptcy trustees, will eventually have to foreclose, sell the homes, and realize the loss.
Hey, if you can get your mortgage company to re-write the loan, great, you have nothing to lose by trying. The problem now is, sometimes the mortgage company is hamstrung by pooling and servicing agreements, FNMA regulations, or other contractual obligations that prevent them from agreeing to such terms, even if they want to.
If you liked that post, then try these...
Four Reasons Not To File Bankruptcy by L. Jed Berliner, Massachusetts Bankruptcy Attorney
Avoiding Bankruptcy: Save Money On Airfares by Susanne Robicsek, North Carolina Bankruptcy Attorney
Feds Don't Go Far Enough to Regulate Subprime Lenders by Chip Parker, Jacksonville Bankruptcy Attorney
2 Trackback(s)
You must be logged in to post a comment.