Many people who face mortgage problems never realized that their financial problems could be solved legally. In fact, your mortgage is a contract. There are laws for your protection. Financially speaking, almost nothing can have a greater impact on a family than losing a home to foreclosure. We’ll explore the foreclosure options that are available to you.
- Mortgage modification: If you don’t want to short sell your home but need to solve back-due payments or obtain a lower interest rate, mortgage modification allows you to request your lender to rework the interest rate and terms of your mortgage. A comprehensive, well-prepared mortgage modification can lower your monthly payments and cure past due mortgage payments. However, Banks have a reputation for delay and lost documents along with a transient and uncaring work force. We can help you with an effective plan to force banks and servicers to stop delaying and quickly get you back on track with new lower payments.
- Mortgage/foreclosure mediation: – If your lender has failed to properly negotiate a meaningful mortgage modification, state court mediation is mandatory in Connecticut during the initial phases of foreclosure. Successful mediation requires experienced and specialized foreclosure defense attorneys. Our attorneys can help you avoid ill-advised short sales by preparing and submitting an application for mortgage mediation based on your unique hardship. Comprehensive financial documentation, a convincing hardship letter, a thorough understanding of what your lender really wants and specialized legal counsel is essential in achieving a modified mortgage with lower interest rates and the reworking of past-due balances.
- Foreclosure defense: Foreclosure defense may be needed against predatory lending, misleading marketing practices and illegal foreclosure actions. When you couple a fully prepared plan and expert legal advice, you can save your home and solve your financial problems on a long-term basis. Foreclosure defense without an alternative plan is just a lawsuit. We can fight on your behalf to prevent improper and illegal foreclosure actions. With our specialized knowledge and experience, we can save your home from foreclosure.
- Chapter 7 Bankruptcy: This stops the foreclosure process immediately and allows you to discharge unsecured debt obligations, freeing you up to make mortgage payments or negotiate a mortgage modification you can afford. Not all consumers automatically qualify for Chapter 7 Bankruptcy relief. Our guidance through Chapter 7 relief provides for a temporary halt on mortgage obligations and elimination of unsecured debt. After Chapter 7 debt relief, your new better budget may allow you to become current on monthly mortgage payments or negotiate a mortgage modification you can afford. We can help you save your home and avoid deficiency judgments without the detrimental tax implications of a short sale or deed in lieu of foreclosure by qualifying you for Chapter 7 Bankruptcy.
- Chapter 13 Bankruptcy allows homeowners to become current on their mortgage loans and other debt through and affordable three- to five-year repayment plan, which also provides for the discharging of unsecured debts, an automatic stay to immediately stop foreclosure, stripping of a second mortgage and modified loan payments. If a short sale or deed in lieu of foreclosure isn’t right for you, a Chapter 13, can help you completely restructure all types of debt, stop foreclosure, and eliminate or modify unsecured debts, a second mortgage, credit lines or tax debts. We have obtained thousands of successful Connecticut Chapter 13 plans enabling families to reach an affordable three- to five-year repayment plan with all types of creditors while protecting all of their family’s assets.
- Deed-in-Lieu of Foreclosure: Under certain circumstances, a homeowner not wishing to keep their home may have no other debt problems other than a difficult first mortgage. In this case, a return of the property to the bank without further obligation for the mortgage can be the best option available. Under this alternative, a deed-in-lieu of foreclosure transfers the house to the bank without the need for an outside sale or any further deficiency obligations.This process is slow and difficult and needs to be well-analyzed for your circumstances, and properly documented by a legal professional. It has serious and permanent long-term effects on your finances and credit score.
- Short Sale: This is a process wherein you sell your home for less than the full debt due. It’s complicated, painfully slow, and rarely successful. To see if it fits your circumstances, call an attorney to learn all the steps, hurdles and goals involved before you even consider a short sale. Don’t get left with a deficiency.
Mortgage Modifications in Connecticut
Your First Chance to Secure a Modification May Be Your Only Chance
Banks rarely consider a poorly presented application for loan modification and almost never reconsider a denied application. Most banks are swamped with loan applications. We distinguish your application from other homeowner submissions.
The key to obtaining approval is to obtain the bank’s attention through the merit and thoroughness of your application.
- Get experienced legal counsel. It takes many years of experience with Banks to maximize the chance for a successful Modification. We know what Banks need and what they want to hear.
- Don’t rely on out-of-state internet modification companies. These companies can make things worse, and they are actually not legally conducting business in Connecticut. Connecticut state law protects Connecticut homeowners from these scam modification companies – but the law has gone unenforced for over 10 years.
- Be prepared. All modifications require a solid, well-founded plan for success in advance. Don’t expect your bank to come up with a solution for you.
- Formulate a solution before you contact your lender. Many people are overwhelmed by their finances, especially when they are unable to pay all of their bills and have trouble getting assistance from their lender. That’s why the help of an experienced professional is the most important step to success.
- Act sooner rather than later. If you find yourself falling behind on mortgage payments, it is better to act sooner rather than later to stop foreclosure. You may have more foreclosure options available to get it right at the beginning. Seek professional help.
- Save your payments. It is essential that you don’t spend payments not accepted by your bank. Although much has been written about so-called “strategic default,” saving at least some of the money not sent to the bank is critical to success.
- Don’t give up your cash. Never make any deal or plan with a bank that involves giving them all your savings as an upfront payment. Homeowners always need a “cash cushion” and any arrangement that doesn’t leave a family with some savings is highly likely to “break” and go back into default in the near future.
- Second Mortgages. Many people have second mortgages or so-called “equity lines” on their homes. These loans are secondary and less important than your first mortgage. Paying a second mortgage while not paying a first mortgage is a poor choice, even if it’s the same bank or servicer. Nonetheless, second mortgages, equity lines and HELOCs need to receive attention and solid solutions.
Chapter 13 bankruptcy saves homes by providing relief from obligations beyond just first mortgage modification. Even if homeowners get a chance to modify a first mortgage, if they don’t get relief on other mortgages, equity lines, or overall debt relief a first mortgage modification alone is unlikely to provide steady, modified mortgage payments or long term financial health. This is especially true given the size of many of these secondary obligations and the fact that they are often variable rate, interest only, short-term lines of credit. Sizeable payments on second mortgages and equity loans with no principal reduction or guarantee of interest rate protection rob family income from more essential payments. Mortgage modifications or solutions that don’t address these other concerns are unrealistic and contrary to the global, long-term success available under Chapter 13 plans.
Remove a Second Mortgage or Equity Line in Connecticut
Under the provisions of Chapter 13, borrowers can petition to remove, reduce, or eliminate certain encumbrances on properties that have fallen in value, such as:
- Home Equity Lines of Credit (HELOCs)
- Other liens
- Second mortgages
- Tax liens
Given the drastic reduction in real estate values, creditors that once appeared to be secured by high real estate values are now “unsecured” or “under-secured” and can therefore be subject to lien removal, reduction, or restructuring under Chapter 13. Depending on the value of the underlying asset, second mortgages and credit lines can be readjusted and even eliminated in total if property values show that the creditor’s claim is truly not “secured.” This is commonly known as lien removal or lien stripping.
Chapter 13 bankruptcy allows for the removal of second mortgages, equity lines, and lines of credit in circumstances that are increasingly common in today’s depressed real estate market. The removal of second mortgages and other lien obligations also reduces your monthly mortgage payments while increasing and protecting your equity. This assures that homes are as affordable as possible while also assuring long-term home ownership.
What Government programs are available during Foreclosure?
There are various programs to stop home foreclosure, but they are still complicated and often unsuccessful. All of the programs depend on banks and servicers who just don’t care. The programs are designed for homeowners who have experienced a serious hardship, like illness, loss of a job or divorce. To participate, homeowners must document their financial hardship and their income.
- Obtaining documents can be very challenging. The paperwork is lengthy and confusing to most homeowners. The application must be complete and accurate.
- You do not need to be late on your mortgage payment to qualify for mortgage modification. But most current mortgages never get attention.
- Government programs for helping homeowners have been widely reported as terribly unsuccessful. Many lenders don’t participate and many professionals believe that government plans have provided false hopes to millions whereby they have actually not saved homeowners, but have led to the loss of even more homes to foreclosure.
- The government has provided huge bailouts and financial windfalls to the banking industry. It is not advisable to rely on that same government to protect your home over the interests of the banking industry.
Why Choose Us for Mortgage Solutions?
Our Office, Our Knowledge and Our Commitment
All of us at The Law Offices of Neil Crane, LLC, have focused considerable legal knowledge and other resources in response to the growing need for foreclosure options and prevention assistance. We know that the surest path to providing the greatest relief to the greatest number of homeowners is the hard work to be done by our experienced team of committed professionals. Our lawyers and experienced professionals have spent their careers protecting the rights of people struggling with debt save their homes and obtain necessary debt relief.
Connecticut People Working for Connecticut People
We have maintained a strong commitment to hardworking local communities since 1983. While other companies may solicit throughout the country, including Connecticut, they are not located in Connecticut and have no commitment to our state’s residents. Our commitment to local communities serves our clients well, whether they are pursuing an interest rate reduction, principal reduction, term extension or saving a home from foreclosure. Meet with an experienced attorney for free, face to face, so you can truly get to know the experienced and reputable professionals who will be helping you end your mortgage problems.
Successful Mortgage Modification Is Hard Work. We Focus on Organized and Detailed Presentations That Lenders Respect.
At The Law Offices of Neil Crane, LLC, we take the time and make the effort to collect information about your financial history and organize it into a format that banks truly recognize. We place great emphasis on attention to detail — providing clear and concise financial information. After over three and a half decades, we’ve learned exactly how to handle banks and foreclosure options.