Stop your foreclosure while trying to work it out

09 Mar Stop your foreclosure while trying to work it out

We’ve been telling you about efforts in Congress to allow mortgage modification in Chapter 13. We at Mortgage Law Network have supported HR 1106 and continue to urge you to write to your senators and congressmen in support of this law, now that it has passed in the House of Representatives.

Today, however, I want to remind you that none of these programs are helpful unless you stop a mortgage foreclosure case in its tracks. If your house goes to foreclosure, the lender has no incentive to work with you and probably won’t work with you. Even if the lender is “working with you” it’s important to stop your foreclosure. The foreclosure machine of your mortgage service usually has no idea what the modification side of your mortgage servicer is doing.

What should you do?

  • When you are threatened with foreclosure,callthe nearest attorney here on the Mortgage Law Network
  • Defend the mortgage foreclosure
  • Raise any counterclaimsor defenses to the foreclosure you have
  • At the same time, discuss loan modification with your lender- youhave a much better chance of compromising a mortgage foreclosure than you do of defeating it. We can help you or you can find qualified non-profit mortgage counsellors to assist you at no charge.
  • Be prepared to file a chapter 13 bankruptcy case to take advantage of the automatic stay and stop the foreclosure.

In the meantime, here are some things you can do to help your mortgage today – even before Congress authorizes mortgage modifications in chapter 13.

President Obama has instituted two programs which will help some homeowners to either modify their mortgages or get decent refinancing without going through bankruptcy in chapter 13.

These programs are called the Homeowner Assistance – Modification (HAM) and the Homeowner Assistance – Refinance (HAR) programs.

Information about these programs can be found at www.financialstability.gov

In two subsequent posts, I’ll be explaining these programs in detail.

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Jay S. Fleischman is a bankruptcy lawyer with offices in Los Angeles and New York. He can often be found on Google+ and Twitter, where he shares information about consumer protection issues and personal finance.
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