Can Mortgage Modification Save My Home?
Kansas City Loan Modification Attorney Explains Ways to Stop Foreclosure
Even if you are behind on your mortgage payments, you may still have options to prevent foreclosure and save your home. In some cases, your lender may allow you to alter the conditions of your original agreement through a loan modification. Alternatively, bankruptcy has multiple protections that may lower your mortgage payments and prevent foreclosure. The right option for you will depend on your circumstances, including any other debts you may owe.
The Sader Law Firm has more than three decades of experience offering legal counseling and guidance to individuals and their families going through tough times. A Kansas City loan modification attorney from our law firm can consider your financial situation and advise you of your best options, including bankruptcy and/or bankruptcy alternatives. Our lawyers provide legal counseling and guidance to individuals and families facing foreclosure and other debt problems. We also offer Chapter 13 bankruptcy filing options with no money due up-front.
Before agreeing to a loan modification, speak with a qualified attorney to learn if you may have better financial options to save your home from foreclosure.
Should I Apply for a Loan Modification?
If you are struggling with mortgage payments, then you can ask your lender to permanently or temporarily modify your original loan agreement. You may be able to lower your monthly payments, saving your home and making it easier to stay current with your mortgage. However, in certain circumstances, loan modification may not be the best choice. A new mortgage agreement may come with conditions that include longer repayment periods and additional interest. Ask yourself the following questions to see if a loan modification may be a good option for you:
- Can you afford the new payments? Lenders will consider your debt-to-income ratio when determining your ability to afford the new mortgage amount. If you have additional debts, such as a car or student loans, then you may not qualify for a loan modification.
- Are you behind on your mortgage payments? Consideration for mortgage modification is only possible if you are behind on your payments. For this reason, homeowners may intentionally stop paying their mortgages to qualify. Due to a backup of mortgage modification requests, it can take months for your case to be considered. If you receive a denial for a loan modification, you may then face a huge arrearage. The bank can then demand you pay in full. If you cannot pay the arrearage, then the bank may foreclose on your home.
- Is the loan modification fair? While your new mortgage amount may seem lower, other contributing factors can make the loan modification more expensive. This includes a longer repayment period, additional interest and added fees that are tacked onto your principal balance. In addition, the modifications to your loan agreement may be in effect for only a short period of time.
Can Bankruptcy Save My Home?
If loan modification is unrealistic for your situation, then bankruptcy can be an effective tool for protecting your assets, such as your car and home. For more than three decades, our bankruptcy attorneys have helped homeowners prevent foreclosure by filing for Chapter 13 bankruptcy or halting the foreclosure process with Chapter 7 bankruptcy.
You can benefit from a Chapter 13 bankruptcy in the following ways:
- Chapter 13 bankruptcy can stop foreclosure sales on homes, even if you file at the last minute.
- Unlike a loan modification, you do not have to be behind on mortgage payments to file for Chapter 13.
- Chapter 13 reorganizes your debts into a single monthly payment plan that lasts for three to five years. This can help you stay on track with your payments and get current on your mortgage.
- Other unsecured debt, such as credit cards, may be discharged in bankruptcy upon completing your Chapter 13 repayment plan. This can make it easier to keep up with your mortgage payments after bankruptcy.
- If the circumstances are correct, then you may be able to use lien stripping in Chapter 13 bankruptcy. This allows you to reduce or eliminate payments on second mortgages.
Want to Stop Foreclosure? Contact a Kansas City Loan Modification Attorney for Help
At our law firm, we tell our clients that bankruptcy and bankruptcy alternatives like mortgage modification are for people who have something they want to protect. We understand that what may be the best option for one person may not be the best option for you when it comes to saving your home from foreclosure. Our attorneys want to see you succeed and can help you find the best solution for your individual situation.
The Sader Law Firm makes bankruptcy law its central focus. With decades of experience helping individuals file for Chapter 7 or Chapter 13 bankruptcy, our law firm knows what it takes to get back control of your finances. Call our Kansas City bankruptcy attorneys today to learn more about your options for preventing foreclosure. You can reach us at (816) 561-1818 or by filling out our online case review form.