Specifics of Mortgage Litigation and Modifications5712566
Mortgage modifications continue to be working and in fact perhaps becoming easier to obtain. This seems apparent as loan servicers completed and issued over 56,000 permanent loan modifications in the month of August. When compared, each alternatives to a mortgage loan modification; loan litigation with http://www.thehoffmanlawgroup.com/ and foreclosure are up 100% and 20% respectively. In keeping with past practices over 85% with the modifications decided upon carried a fixed payment for 5yrs, while 68% offered a reduction in monthly interest rate and principal. The whole amount of loan modifications completed since 2007 has reached 4.86 million. The breakdown is around 4 million being carried out by servicers making use of their own modification guidelines and almost 800,000 loans being modified under the government's Home Affordable Modification Program (HAMP). These numbers may appear high however it must be noted that you have over 2.8 million delinquent mortgages greater than two months late or longer.
These delinquent homeowners have four choices:
- attempt a mortgage loan modification
- short sell their house
- lose it to foreclosure
- sue their lender
Homeowners seeking one of these four options, have several professionals, usually a law practice, to turn to for advice. Seeking a modification is virtually always the first step taken. Unfortunately lenders and servicers have not been overly accommodating and plenty of borrowers throw in the towel and seek a short sale rather than foreclosure. Litigation, another choice, has become more prevalent for two main primary reasons. The first reason is the fact that homeowners are granted "trial modifications" then don't be given a permanent modification. Because of this many plaintiffs have obtained settlements for breach of contract. Your second reason is definitely the current investor of an note, grants a trial modification then sells the borrowed funds in that free trial. The new investor of your loan doesn't honor the trial modification agreement reached with all the previous owner of your note. The reason why the new investor would this is they have paid a small part of the balance of your note of course, if they foreclosure an easy profit can be achieved. Thus the modification applied for because of the original lender/investor isn't as attractive. The courts have ruled in favor of the homeowner in cases like these.
SUMMARY Many homeowners instinctively have the desire to remain in their houses at all costs. In truth investing in a modification and making payments for numerous months throughout the negotiations isn't worthy of the payment reduction made available from the loan originator when all is settled. The truth is thehoffmanlawgroup.com/ tells that approximately 50% of most homeowners granted a modification are delinquent again within 2 yrs. Maybe a short sale to start with rather than a modification would give you the homeowner that has a clean slate, save them money and alleviate stress. The fight to maintain one's home very often ends in foreclosure, bankruptcy and missing the cabability to use their lender through other means when compared with a modification, for example the short sale option.
