Individuals with FHA (Federal Housing Authority) loans must now allow qualified borrowers who have lost their jobs to miss up to one years worth of mortgage payments prior to bringing a foreclosure proceeding against them. There’s currently a three to four month forbearance period for unemployed individuals. Unfortunately, most men and women who lose their jobs stay out of work for much longer than three or four months.
Secretary of Housing, Shaun Donovan, stated that “providing the option for a year of forbearance will give struggling homeowners a substantially greater chance of finding employment before they lose their home.” The Obama Administration seeks to remove hurdles for individuals to qualify for this program. Financial institutions who deny the one year forbearance to unemployed individuals must allow the mortgagors seven calendar days to provide further information that may change the servicer’s mind concerning this issue. All FHA service providers must cooperate with this new mortgage forbearance program. This new initiative by the Obama Administration is welcomed by both men and women who are out of work and the real estate industry in general. The huge number of homes being foreclosed upon is depressing the real estate market.
Foreclosure is a nasty term. Foreclosure notices are depressing. There’s a tendency when your financial troubles are out of control to try to avoid these problems. This is a wrong way of dealing with this problem. Come to us, we can help you! We litigate all aspects of foreclosure proceedings including, but not limited to, defective foreclosure lawsuits, defective mortgages, predatory lending issues, bad faith, and other real estate legal issues. We attend foreclosure court conferences for the clients we represent. We also assist our clients in the preparation of mortgage modification applications, as well as deal with mortgage modification programs that are unresponsive to our clients’ needs.
In certain situations, foreclosure related bankruptcies can be utilized to stop foreclosures from moving forward. Upon filing either a Chapter 7 or a Chapter 13 bankruptcy, the bankruptcy court issues an automatic stay that stops the foreclosure lawsuit from moving forward. It should be noted that bankruptcy proceedings are brought in the United States Bankruptcy Court, while foreclosure proceedings are brought in New York State Courts.
For our clients who file bankruptcy, we can sometimes eliminate second mortgages. We also can assist our clients in re-establishing their credit after filing bankruptcy. Should you have questions as to what type of bankruptcy would be appropriate for you or whether there is other alternatives related to foreclosure defense, feel free to contact us. At your initial free consultation, we will discuss all of your foreclosure options. We look forward to seeing you again on our foreclosure blog.
