Illinois Bankruptcy Lawyers Compare Benefits of Chapter 13 to Loan Modification
Loan modification is a good idea in theory. You can't afford your mortgage, so a modification company convinces the bank to rewrite your loan, lowering your monthly payment to a more reasonable level. You can afford to keep your house while the bank avoids having to go through the costly foreclosure process - and under the government's new Making Home Affordable initiative, gets a $1,000 incentive for modifying your mortgage. Everybody wins, right?
Ah, if only that was the reality. The $75 billion taxpayer-funded mortgage relief program was intended to prevent millions of eligible homeowners from falling into delinquency and foreclosure. But instead, millions are still losing their homes.
It seems that despite the money carrot, lenders are still not buying the program. A recent story in the New York Times exposed what consumer affair bureaus have known for a long time - many candidates for loan modification never make it through the red tape at the bank.
To be fair, banks are overwhelmed by the sheer number of calls they're receiving due to the program. But that doesn't help homeowners. Imagine that your bank loses your paperwork three times in a row, bounces you around the call center until you're disconnected or hung up upon, and eventually makes a mistake that disqualifies your modification - and requires you to start from square one. It's enough to give you a headache - and make you give up. And that, from the bank's point of view, is the idea.
But a failed loan modification doesn't have to be the end of the road. It doesn't even have to be the beginning of the road. Chapter 13 bankruptcy is a much easier and more effective way to lower your payments and keep your home. First, it's your basic legal and constitutional right as an American. Second, it's a guaranteed way to stop foreclosure and quiet lenders - no wading through red tape required. Third, you don't have to go it alone - you'll have help from a knowledgeable bankruptcy attorney.
Sound a little more appealing? Why not find out if bankruptcy could be a better solution for you? Try our free one-on-one debt analysis and let a DebtStoppers attorney in Chicago or Atlanta help you identify the best way to eliminate your debt and save your house. There might not be an easy solution when you can't afford your mortgage, but there is always a better one. In this case, consider the one that works - bankruptcy.