Can You Re-Structure Your Mortgage?
A real estate workout is a negotiation between borrower and lender aimed at reaching resolution of a troubled loan and reducing the incentive of the borrower to file for bankruptcy. Many mortgages that are now in default were originated in a time of careless and sometimes fraudulent underwriting. A thorough review of many mortgage files reveal arguments or defenses a borrower can use against a lender. For example, the lender may have made mistakes in originating the loan or failed to follow protocol in a foreclosure proceeding. The individual circumstances of each case will dictate the leverage points and corresponding results.
Foreclosure Negotiation
In some cases, it is possible to negotiate with a lender once foreclosure proceedings have already been initiated. Although North Carolina is a power of sale foreclosure jurisdiction that allows for a fairly speedy foreclosure process under normal circumstances, the recent flood of foreclosures has caused many postponed hearings and sale dates. Hiring a lawyer to attend the pre-sale hearing and asking for additional time to come current on arrearages or prepare a case in objection to the foreclosure can further delay the process.
Federal Mortgage Modification Programs
In addition, there are federal programs in place aimed at stemming the rising tide of foreclosure in North Carolina and across the country. In April of 2009, the Obama Administration unveiled the Making Homes Affordable (MHA) Program. Banks and servicers are authorized and encouraged to modify home loans when certain conditions have been met. If you’re currently living in your home but find yourself significantly underwater or are devoting more than 31% of your household income to monthly mortgage payments, you may qualify for a modification. We can help you navigate the bureaucracy of the banks to determine whether you qualify and ultimately achieve the best possible result.
Deed in Lieu of Foreclosure, Short Sale Negotiation
Either as an alternative to a stalled loan modification or as your primary goal from the outset, we can assist you in negotiating a short sale or deed in lieu of foreclosure for your primary residence or troubled investment property. The goal is to resolve your mortgage debt without filing bankruptcy and by eliminating any potential exposure to a deficiency judgment due to a drop in property value.
If you would like to discuss your options for dealing with a troubled real estate loan, please contact us to schedule a phone consultation.
