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Why are Mortgage Modifications Denied?

Have you applied for a mortgage modification? If you have, you may have experienced a long, arduous process. The processing agency or financial institution may request your paperwork on three, four, or as many as six different occasions. Some New Yorkers who have come to our law firm have suggested that the mortgage processing companies are hiring imbeciles.

Long Delays

Why does the process have long delays? The reason for the long delays is the banks have failed to hire sufficient employees to properly process mortgage applications. The banks also didn’t take into consideration the length and depth of the financial crisis facing this country. The high unemployment rate, the down sizing of jobs and the recessionary problems in the United States have caused thousands and thousands of Americans to apply for mortgage modifications. The banks simply did not take into consideration the volume of mortgage modification applications they would be receiving.

Mortgage Modification Denials

There are a variety of reasons why your mortgage modification may be denied. The single largest reason for denying mortgage modifications is the financial institutions claiming you didn’t provide them with all the necessary paperwork. This is the most frustrating denial, especially when you provided the paperwork to them on several occasions and they simply lost or misplaced it. A second reason for denying mortgage modifications is that you have too much debt. If the financial institution feels you already have more debt that you can handle, they will turn down your mortgage modification application.

Insufficient Income

Another reason why many mortgage modification applications are denied is the failure to have sufficient income to support your financial obligations.

Bankruptcy

You can discharge debt through filing bankruptcy proceedings. You can go through the bankruptcy process and thereafter file a mortgage modification application. At the end of the bankruptcy, you will have eliminated your debt and you therefore may be a superior candidate for a mortgage modification at that time.

Second Mortgages

There are situations where a family’s mortgage modification application on their first mortgage is approved. However, they may still have a non-performing second mortgage. In these situations, you may be able to discharge your second mortgage by filing bankruptcy. A Chapter 13 bankruptcy can eliminate your second mortgage.

Foreclosure Lawyers

We can fight your foreclosure. We litigate predatory lending issuesdefective foreclosure lawsuits, and defective mortgages. We attend foreclosure court conferences for our clients. We draft mortgage modifications and deal with mortgage modification programs that fail to meet our clients needs.

We also litigate foreclosure related bankruptcies, whether they’re a Chapter 7 bankruptcy or Chapter 13 bankruptcy. We also assist our clients in re-establishing credit after filing a bankruptcy. We can help stop your foreclosure from moving forward! Call us and we will provide you with a free consultation. We will discuss all of your foreclosure options.

Foreclosure Proceedings are Devastating Communities Throughout the Country

The value of homes throughout the country has gone down. Many Americans live in homes that worth less then the amount of their mortgages. The high unemployment rate and the downsizing of jobs by many employers have robbed homeowners of the ability to make their mortgage payments.

Foreclosure on Long Island

Nassau and Suffolk Counties on Long Island have some of the highest foreclosure rates in the State of New York. President Obama’s programs have not stopped foreclosure rates from rising.

It is estimated that it takes approximately 2 ½ years for lender to complete a foreclosure proceeding and take title to a home in New York State. Homeowners who are losing their homes lose motivation to maintain their property. This causes a blight on their neighborhood which has a negative effect on the surrounding homes in their community.

Loan Modifications

Lenders in the United States are doing a terrible job in processing loan modifications. The process is slow, painstaking and yes poorly managed by the financial institutions.

The housing problems in the United States are slowing down the economic recovery. More has to been done by financial institutions to modify mortgages and allow homeowners to stay in their homes.

Foreclosure Defense Lawyers In New York City and Long Island

Law Offices of Schlissel DeCorpo represents homeowners whose homes are in foreclosure. We assist the homeowners with mortgage modifications. We litigate issues involving defective foreclosure lawsuits, predatory lending, defective mortgages and real estate problems in general. Our attorneys are familiar with the federal laws involving foreclosure.

Sometimes the best way to deal with a foreclosure proceeding is to file foreclosure related bankruptcy. In these situations we file either Chapter 7 or Chapter 13 bankruptcies on behalf of our clients. These bankruptcies stop foreclosures, stop debt collections and allow our clients to obtain a fresh start. Feel free to call us for a consultation.

Home Construction Rates Keep Falling

The home construction industry in the United States is in the doldrums. Builders are not applying for permits for new projects. Applications for building permits are at the lowest level in fifty years. Falling home prices, the huge glut of foreclosed homes in the market place and purchasers reluctance to buy a new home is destroying significant portions of the home building industry.

Jobs, Jobs, Jobs

Americans need jobs. The unemployment rate is too high! The housing industry will not recover unless more Americans are employed.

Tight Credit Markets

Both builders and prospective home purchasers need to obtain credit before they can build and buy homes. Right now small home building companies have been shut out of the credit market. Since they can’t obtain credit, they do not have the means to build homes. The few that are building homes are finding it very difficult to find perspective purchasers who’s credit scores and liquidity allows them to qualify for a new mortgage.

The housing industry in the United States is a mess. Things will continue to get worse unless financial institutions make it easier for homeowners to modify their mortgages.

Foreclosure Help in New York

If your home is in foreclosure we can help you. Our law office defends homeowners in foreclosure proceedings. We litigate defective mortgages, defective lawsuits, predatory lending issues related to foreclosures and other real estate problems. We are familiar with federal laws that deal with foreclosure. We assist our clients with mortgage modifications. After foreclosure lawsuits are started, we represent our clients at foreclosure court conferences.

Bankruptcy

In the appropriate situations we file foreclosure related bankruptcies for our clients. These bankruptcies can either be a Chapter 7 or Chapter 13 bankruptcy. These bankruptcies can be used to eliminate second mortgages, stop foreclosure proceedings and also stop all debt collection activity. At the end of the bankruptcy, we can help our clients in re-establishing their credit. Feel free to call for a free consultation or contact us online.

Bankruptcy and Foreclosure

The main reason for homes going into foreclosure in the United States is the high unemployment rate. Homeowners who lose their jobs can’t pay their mortgages and, eventually, their homes go into foreclosure.

Subprime Loans

President Obama’s programs to deal with the foreclosure crisis in the United States were originally focused on individuals who had taken out subprime loans. It was originally thought that the subprime loan crisis was the primary cause of the high foreclosure rate in the United States. But there is a new villain in the real estate crisis – constant high unemployment rates in the United States.

Federal Programs Dealing With Unemployment and Foreclosure

The Obama Administration does have programs to help individuals who have lost their jobs delay mortgage payments. Unfortunately, the programs are designed to delay mortgage payments for a period of only two months. Since the average length of unemployment is now nine months, these programs don’t work. As of the present time, only about seventy-four homeowners have qualified for these programs.

Bank Bailout Program

The Bank Bailout Program undertaken by the Obama Administration provided $46 billion for the purpose of allowing homeowners whose homes have fallen into foreclosure to keep their homes. The Treasury Department has only spent $1.85 billion dollars to date. It is estimated that more than a million homes have gone into foreclosure because of insufficient assistance from the government for unemployed Americans.

An Obama Administration spokesperson has stated the problems with the programs to assist homeowners whose homes have fallen into foreclosure and are currently unemployed are related to the fact that the programs are voluntary. It is up to the financial institutions, the mortgage servicers and the investors to decide who receives aid and who doesn’t. James Parrot, an adviser at the White House’s National Economic Counsel, stated, “We are trying to be careful in designing programs that, at the end of the day, aren’t just about spending money but getting people back on their feet.”

Home Affordable Mortgage Modification Program (HAMP)

The Home Affordable Mortgage Modification Program was designed as a foreclosure prevention initiative. Approximately 675,000 homeowners have received mortgage modifications under this program. This represents less than 10% of the homeowners who required financial aid to keep their homes from being foreclosed upon.

Department of Housing and Urban Development Program

There is a program that has been initiated by the Department of Housing and Urban Development to deal with unemployed homeowners. More than a million dollars has been allocated to finance this program. The program is designed to provide loans to homeowners who have lost their jobs. These loans can last for a period of up to 24 months. As of the present date, there are only five states that have implemented this program.

Conclusion

The foreclosure mess in the United States, initially caused by granting sub prime loans to unqualified homeowners, is further exacerbated by the unemployment crisis that continues to exist in this country.

Bankruptcy and Foreclosure

We are foreclosure defense lawyers. We help homeowners stay in their homes, even when they’re in foreclosure. We assist homeowners with mortgage modifications and mortgage modification programs that fail to meet their needs.

We litigate predatory lending issues, defective foreclosure lawsuits, defective mortgages and issues involving federal laws and foreclosure. We attend foreclosure court conferences on behalf of our clients. We discuss foreclosure related bankruptcy issues.

In the appropriate circumstances, we file Chapter 7 and Chapter 13 bankruptcieson behalf of our clients. We discuss with our clients why bankruptcy filings will be helpful to them and the types of bankruptcies available to them. Filing bankruptcy can stop foreclosures from moving forward and stop debt collection from collection agencies and collection lawyers. At the end of the bankruptcies, we can help our client in re-establishing credit. We appreciate your spending time on our foreclosure blog.

Foreclosure Defense in Valley Stream, Lynbrook, Baldwin, Malverne, Freeport, Oceanside, Long Beach, Elmont, Lakeview, West Hempstead, Hempstead, Merrick and Bellmore, New York

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We represent individuals throughout the New York Metropolitan area with divorce and child custody, personal injury, car accident, wrongful death, estate administration, nursing home and medicaid issues

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