Loan Modification Program Hits Target, But Is It Enough?
The economy might be recovering, but we're not out of the woods yet - especially when it comes to foreclosures.
Even though a $75 billion government anti-foreclosure program recently reached its goal of helping 500,000 folks get loan modifications, that's only one-eighth of the 4 million homeowners it originally set out to assist. And while some banks have helped more than one-third of eligible homeowners with the program, others like Wells Fargo and Bank of America have helped just 20 and 11 percent, respectively.
Now consider that millions more are facing foreclosure but ineligible for loan modification. Still, as many as half of those who receive a modification end up defaulting anyway. It's depressing stuff. But luckily, there's another government program that can save your house. It's been around for years, has been proven to work again and again and doesn't require your lender's approval - it's bankruptcy.
Bankruptcy can help you keep your house in more ways than one. First, it can stop foreclosure directly thanks to the automatic stay, a legal action that goes into effect right after you file and protects you from creditor moves like foreclosure, repossession and lawsuits
Second, it addresses the root of the problem - usually debt. Why do people default on their homes? Because they can't afford their mortgage payments. Maybe they bought at the height of the market and now they're upside-down. Or maybe their income has decreased so that, even though their mortgage is the same, they have less money to spend. When you reduce debts with bankruptcy, you'll have more money left over to spend on the mortgage - whatever the size of your monthly payment.
There's still a foreclosure crisis in this country, but there are also solutions - and bankruptcy is a solid one. You don't have to wait to find out if you're one of the minority that can qualify for a loan modification - and if that modification will be enough. Why not sign up for a free one-on-one debt analysis with one of our Chicago bankruptcy lawyers right now online? Let us identify a bankruptcy plan that can keep a roof over your head and more money in your pocket.