Foreclosure Defense Lawyers

Do I Need a Foreclosure Attorney?

Wealthy mortgage holders are not immune from the possibility of foreclosure. In today’s tough economy, many high-end homeowners as well as middle-class homeowners have been caught between a rock and a hard place. The downward spiral of home values combined with declining business income has put many at risk of losing their homes because of defaulted mortgages.

Are You at Risk of Losing Your Home? Stop Foreclosure.

Discover the best way to save real estate that is at risk of foreclosure with the help of foreclosure defense attorneys. “Foreclosure defense” is a broad term that can be defined in several ways, including:

Loan modifications

These government-endorsed programs may sound good, but in practice, many homeowners find the requirements too onerous to meet. Nonetheless, it can be a valuable exercise to explore this option with the help of an experienced foreclosure defense attorney.

Challenging the lender in court

Does your mortgage lender actually possess the properly signed mortgage contract that would give that lender the power to take your home and evict you? Sometimes the answer is no.

Court mediation

Many property owners have removed the threat of foreclosure through mediation, during which they demonstrate hardship and prove that they are prepared to fulfill the terms of a mortgage on a different timeline than what was originally agreed upon.

Negotiating alternative solutions such as short sales

If you agree to a short sale, be careful that provisions in the paperwork you sign do not still hold you accountable for the difference between the proceeds of the sale and the lender’s idea of the value of your property.

Mortgages & Chapter 13 Bankruptcy

Many well-to-do and middle-class homeowners balk at the idea of filing bankruptcy until they truly understand the power of the automatic stay. You may be able to keep your house and pay back mortgage arrears over several years with little or no interest by filing for bankruptcy.

Most bankruptcy filers prefer to file Chapter 7 bankruptcy because it is quicker and results in the discharge of most or all debt. However, there are times when Chapter 13 is the appropriate form of bankruptcy, such as:

  • When assets and/or income are too high to qualify a debtor for Chapter 7
  • When larger amounts of home equity are part of a debtor’s asset portfolio, and the debtor has a goal of keeping the house
  • In some cases, when just a wife or a husband wishes to file bankruptcy without the other spouse taking part
  • When there are large amounts of nonexempt debts to deal with such as student loans or child support arrearages
  • When time is less important to the debtor than making a good-faith effort to repay what he or she is able

Remember that Chapter 13 bankruptcy offers mortgage holders, even those with high home equity levels, the opportunity to stave off foreclosure through the automatic stay. Some debtors then use the three- to five-year period to make viable plans for the future without the pressure of the threat of foreclosure.

Stripping a Second Mortgage Through Bankruptcy

Mortgage debt may seem insurmountable, especially if you have a second mortgage or have been extended a home equity line of credit. If you find yourself unable to keep up with your mortgage payments, however, there are solutions available to you. Chapter 13 bankruptcy provides a way to strip your second mortgage or home equity line of credit.

Can I Get Rid of a Second Mortgage?

In order to get rid of a second mortgage, third mortgage, or home equity line of credit, your house must be “underwater.” This means that the value of your home is less than the current balance of your existing mortgage debt.

If the value of your home has been greatly reduced in the recent housing crisis, you may be able to get rid of any other home loans that exceed the value of your house. For example, Stacey has a home worth $200,000. Her first mortgage is for $250,000 and her second mortgage is worth $40,000. Since her first mortgage exceeds the value of her home this second mortgage will become unsecured in Chapter 13 bankruptcy and can be discharged.

When you work with our firm, we will closely examine all of your debts to determine a solution that works best for you. If stripping a second mortgage is in your best interests, we can help you file for Chapter 13 bankruptcy. Filing for bankruptcy can also put a stop to the home foreclosure and help you reorganize your debts into manageable monthly payments.

Assets you can keep through Bankruptcy

Bankruptcy exemptions are those assets that are not subject to liquidation in bankruptcy. Naturally, the vast majority of debtors hope to keep as many assets as they can, in spite of a bankruptcy filing.

As you prepare to file bankruptcy, consult with a knowledgeable bankruptcy law attorney to understand clearly how to classify your assets, such as:

  • Unsecured debts versus secured debts: A car loan is a secured debt, which means that the lender can repossess the car if you do not pay. Credit card balances for goods and services already consumed are unsecured debt. There is nothing to repossess per se.
  • Federal versus state exemptions: Depending on your circumstances, it may be to your advantage to use Connecticut state exemptions or federal exemptions spelled out in the U.S. Bankruptcy Code.
  • Connecticut homestead exemption versus federal real property exemption.
  • Car or truck exemption
  • Insurance exemptions (disability benefits life insurance, health benefits, and/or unemployment benefits)
  • Alimony and child support exemptions
  • Retirement savings exemptions
  • Personal property exemptions versus tools of the trade
  • Wedding rings, burial plots, health aids, musical instruments, and more
  • Wage garnishment exemptions
  • Wild card exemptions

Any assets that fall under the category of exemptions (either state or federal, depending on which of these you use) will not be liquidated in your Chapter 7 or Chapter 13 bankruptcy. A no-obligation consultation with an experienced lawyer is a good starting point for the task of characterizing assets.

Foreclosure Defense Lawyers Near You

When you retain a Foreclosure Defense attorney, you can expect to be well-informed and prepared to make decisions in your own best interest.

Leave a Comment