Practical effect of Bankruptcy on Foreclosure
If you are facing foreclosure and or other debilitating and caustic financial challenges it is a time for careful reflection because the decisions you are in the process of making are going to have lasting effects on your credit FICO score, your ability to borrow money and the cost of money to you for years to come. There are many attorneys who will strongly suggest bankruptcy to you as an alternative to foreclosure. As a practical matter bankruptcy is not an alternative to foreclosure, it ONLY buys you a little time while having a fairly significant impact on your credit. Trust me, just as soon as your bankruptcy is discharged your mortgage lender will be waiting with a motion to lift the stay on their ability to foreclose on yur property. Further, bankruptcy can prevent you from obtaining the employment you would otherwise enjoy. It can also prevent you from having certain security clearances which is very important here in Washington DC, Virginia and Maryland area where the Federal payroll is the largest supplier of employment.
So how does one decide. This is not legal advice but rather a practical look at choices one has facing foreclosure. In my opinion, if foreclosure is the only significant issue you face and you have little or no unsecured debt such as credit cards,medical bills, non secured credit lines or department store credit cards, don't get talked into bankruptcy and don't allow foreclosure. You can Short sell the property and regroup. You'll be able to borrow again in 2 years within the new federal underwriting guidelines. Or alternatively, if you are not terribly upside down in the property you must consider obtaining a REAL forensic mortgage audit. More so if you are in an adjustable rate mortgage. 99 out of 100 of these ARM's are loaded with underwriting violations some of which allow you to rescind your mortgage altogether. (go to the rescission page for more on rescission) A complete forensic analysis of your mortgage gives you leverage on your lender. Here's the deal. If your lender understated the finance charge on your final truth in lending disclosure by more than $35.00 your mortgage is legally non-foreclosable. Finding this violation gives you excellent protection under regulation Z of the Truth in Lending Act. Banks do not want you to know this. They want to be able to obfuscate, procrastinate and humiliate you into giving your last few dollars to them. In my opinion it is so much better to not pay your lender but give the money to a good RESPA / TILA attorney to fight for your rights if you find significant violations within your mortgage. It just makes sense. The lender will have a high probability of making you an offer to lower your rate, fix the rate and potentially give you a principal reduction if your mortgage has a rescissionable violation of TILA. A good attorney can file an injunction or TRO- Temporary Restraining Order to stop foreclosure based on the results of a forensic loan audit and put you in an excellent negotiating posture with your lender. It works, we know because we do it.
Now on the other hand, if you have massive unsecured debt and no ability to repay or if it will take you 10-15 years to pay off your unsecured debt and your home purchase was much more home than you need and you are significantly underwater, bankruptcy is a good option. You can short sell it while in bankruptcy in most cases. Bankruptcy doesn't carry with it the meaning or social consequences that it once did in the wake of this credit crisis. The lenders know that their own policies created the sub-prime buying frenzy that resulted in the economy we now face. It was in all probability their fault not yours. Further, bankruptcy will cause your cost of money to be higher in the foreseeable future but it will not prevent you from borrowing. Many of our clients report getting credit card offers and mortgage fliers just months after their bankruptcies are discharged. Legal Forensic Auditors shares office space with a RESPA TILA attorney and we will be happy to take a free look at your mortgage documents to help you determine if a full forensic audit is your best next move. Fill out the form below if you are in mortgage trouble or facing foreclosure.
If you are behind on your mortgage, in jeopardy of losing your home, cannot afford your current payment because you expected to refi but cannot, Read the step by step QWR page after filling out this form. We will contact you within 48 hours.
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We are actively looking for TILA and RESPA familiar attorneys in the following cities: Please contact us if you are a bankruptcy or litigation attorney in one of these areas who files rescission actions against mortgage lenders and wish to partner with a real forensic mortgage auditing shop.
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Questions and Answers
Article Tags:
facing foreclosure
This article provides information for people who are facing the threat of foreclosure and how to stop the foreclosure process.
Even celebrities face foreclosures. A controversial television star is reportedly facing a foreclosure case and may end up losing her $6 million home in Southern California.
One in every 7 homeowners is facing foreclosures the numbers of people in crisis are at epic proportions in 2009 and growing, unfortunately most of the reports only deal with the implications on the lenders and the help is slowly trickling in. The lenders were not prepared to deal with the kind of numbers of loan modification requests coming in and have had to ramp up and train staff just to try to catch up.
If you are one of the many American homeowners facing foreclosure, you are not alone. There are millions of homeowners that have already fallen victim to foreclosure and there are many, many more in danger of foreclosure. One solution that has gained in popularity is the chance to get a loan modification. In essence, the bank may be willing to lower your rate of interest, extend your loan term, and even defer or eliminate part of your principal balance.
When facing foreclosure issues, lots of people out there would struggle to find financial assistance that could help them overcome their predicaments. Financial assistance for those facing foreclosure is widely available out there, provided that you know where to look! The government is a perfect place for those looking for financial assistance to help them overcome foreclosure issues, thus you should first and foremost explore the option of the government before you look anywhere else.
This article makes the case for homeowners facing foreclosure as the most motivated sellers possible and how that can make for sweet deals for the foreclosure investor.
Students from both private and public universities all over the country may also provide low cost or free advice. The sessions will only achieve directing clients to the right legal path in filing the right papers. Note that with the new bankruptcy laws taking into effect making the bankruptcy filing process more difficult than usual, an experienced bankruptcy attorney will be worth your money.
Many people who enter the bankruptcy process worry about the fate of their credit. This is actually unnecessary as the bulk of credit damage happens before the bankruptcy process is even initiated. While no one wants the added hassle of rebuilding their credit after resolving debt troubles, doing so can put you leaps ahead of others in the credit game.
Americans are now filing Chapter 7 or 13 Bankruptcy to get their debts under control. Bankruptcy in itself is designed for debt elimination. Chapter 7 bankruptcy functions to cancel out unsecured debt such as utility or medical bills, credit card, etc. Chapter 13 Bankruptcy on the other hand is designed to give individuals more time in repaying all their debts.
Filing for bankruptcy is good news whenever you are struggling with your credit card debt, mortgage or medical bills. Bankruptcy laws help families and individuals in their debt struggles. You have two options on how to deal with your debt problems, Chapter 7 (debt elimination) and Chapter 13 (reorganization). Always remember that you can regain credit again after successfully filing your bankruptcy.
Here is an easy way to know how to hire right attorney Mesa AZ. Many people in Mesa AZ have legal complications. The only savior to such situation is attorney Mesa AZ
While it is widely known and blogged practically all over the internet that there are mortgage modification scams all over the country, it has come to our attention that at least a few of these scammers are now jumping into the forensic mortgage auditing business. Here are some rules of thumb to follow if you are looking for a solid forensic loan auditor.
Has anyone had a client receive a notice of conditional acceptance for a Principal Reduction from Bank of America? Any other national lenders? They are happening, I have some of them here in my office and I have a strong theory. We have researched a principal reduction negotiation shop with a couple of attorneys and a certified forensic mortgage auditor and a few CPA's that have negotiated 334 principal reductions over 24 months. These guys are under the national radar screen.
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