Homeowners facing negative equity on their homes may be worried about the prospect of foreclosure. Owing more on your mortgage than the home is worth is an unsettling prospect in the best of times; add in a bit of job turbulence or the possibility of a medical emergency, and it becomes quite frightening, with foreclosure a real and looming specter. In such times it is a good idea to talk to a New Port Richey bankruptcy lawyer, who may offer one or more of the following alternatives, based on your specific needs.
Loan Modification to Avoid Foreclosure
The Making Home Affordable Program, introduced in 2009 to help offset the impact of the housing bubble crash, has been responsible for helping many homeowners faced with untenable mortgage payments and negative equity. The Program includes the Home Affordable Modification Program (HAMP), which allows loan modifications for underwater mortgages at more favorable terms for the borrower. The focus in these programs is to find solutions workable for both the lender and the borrower, and help avoid foreclosure.
A foreclosure proceeding can be expensive from the lender’s side, with all the legal action involved, and then the process of making the home saleable and paying taxes on the new sale. Lenders are often looking to avoid foreclosure just as much as borrowers; often, a short sale can provide a mutually beneficial solution, allowing the lender to recoup a good portion of their loan amount while the borrower is able to get out from under the loan burden, while minimizing the costs associated with foreclosure.