Mortgage Modification Workout Programs Louisville Kentucky
So why is answering a foreclosure complaint required if you are attempting a mortgage modification or workout? Because banks are predators. Unless you are act firm but fair with the mortgage company your plan will be denied and your home will be foreclosed.
Foreclosure rates continue to climb although short sales, workout agreements and mortgage modification programs are in place. While you are working on a modification the bank is continuing to work for a sale date because they are paid in full with interest from mortgage insurance policies and government programs if the home goes into foreclosure. What you are offering them is less than what the foreclosure will pay them. That is why homes are often sold before the workout agreement can be made unless you fight the foreclosure to give yourself time and bargaining power.
Mortgage modifications are rarely approved unless the homeowner shows that the modification, workout or short sale is in the best interest of the mortgage company. Many people are under the impression that the mortgage companies want to help the consumer. The mortgage company’s goal is to make a profit. They will do what makes the most profit. Since most mortgages have insurance that pays them if you don’t they rarely accept deals.
The 2010 foreclosure prevention programs have been ineffective. Mortgage companies opposed granting bankruptcy judges the power to modify mortgages and make them reasonable or affordable. Instead government programs gave bail outs to mortgage companies because they are too big to fail through programs to the very predatory mortgages companies that made these loans.
Why? Mortgage lobbyists influence legislators. Homeowners have no effective voice to stop the foreclosure crisis. As a result, the foreclosure prevention money is funneled to mortgage banks through “foreclosure prevention programs” instead of to homeowners that need it.
Billions were spent on the modification program but few homeowners got it. They ones that got showed:
- they could afford to repay something,
- they would repay more than what the bank would get in foreclosure.
- if the bank didn’t agree that they would fight back and it make it take years to foreclose if at all
The banks billed billions to administer the programs. Mortgage companies enrolled homeowners into temporary modification programs but later denied them the permanent modifications they needed to avoid foreclosure. This forced homeowners into bankruptcy or foreclosures while banks billed insurance companies and the government for it. That is right - the mortgage companies were the only ones that benefited, they reaped the rewards of the foreclosure prevention programs funded by taxpayers while avoiding the responsibilities of risky loans they made. Homeowners were given false hopes they could save their home with foreclosure prevention programs. Instead homeowners were forced to abandon homes if the interest rate was too high and there was no equity and file Chapter 7 or attempt to save the home in a Chapter 13 bankruptcy.
Nick Thompson Louisville Kentucky Chapter 7 13 Bankruptcy Attorney
