Another Foreclosure Avoided

10623056-detroit-foreclosure-preventionThis week I was able to obtain a dismissal of a foreclosure case filed in 2011 after my client successfully completed his loan modification. He just needed some time, and that is what I was able to obtain for him.

Good people sometimes need a second chance. Most foreclosures are a result of an unexpected life event, such as:

  • Death in the Family
  • Difficult and costly Divorce
  • Lost Job or had to Change Jobs
  • Health problems with Expensive Medical Bills

And never before has the expression “If I could just buy some time” meant so much. When facing foreclosure homeowners need time to discover their options, analyze their situation and implement an action plan. The most precious commodity is time…And it’s running out.  However, there are various ways that an attorney can get you the time you need.  Sometimes, as in a recent case, it is as simple as filing an Answer to the Petition and requiring the foreclosing lender to actually prove that it is the proper Plaintiff to bring the case.  If it isn’t a Dismissal Without Prejudice is appropriate.  Other times, as in another recent case, deficiencies in the Lender’s Motion for Summary Judgment can be identified, and the Judge may issue an Order denying the Lender’s Motion for Summary Judgment.

Homeowners’ options are changing because of the magnitude of the housing problem.  There is a chance to work things out with the lender if the homeowner fights for that chance. More banks are willing to work with borrowers today simply because they really can’t manage the huge backlog of homes which have already been lost to foreclosure. If the borrower can present a viable plan to repay the loan, the chances of retaining home ownership are pretty good.

The process can go fairly quickly. Here’s a basic rundown of the mortgage modification process and how long each step takes:

• Obtaining the modification package: Getting a loan modification package in the mail can take anywhere from a few days to a few weeks, depending on how long it takes to get a hold of the right loss mitigation manger, and of course, how many other modification requests being considered at the moment.  Lately, the attorneys for the foreclosing lenders have been willing to forward the applications directly to the attorney for the homeowner.  This can speed up the process.

• Submission of the loan modification package: It should take a week to fill it out and get it back to the lender with all the requested documents.

• Underwriting and internal auditing: Once the lender receives the modification package, they will check it over for mistakes, and then send it on for an in-depth review. Assuming that no questions arise regarding the paperwork, this should only take a few days.

• Assignment to a mitigation specialist: After being reviewed by the underwriters (which can take another week or two), the matter will be assigned to a loss mitigation specialist who is authorized to make the final decisions regarding the loan modification request.

• Decision and mitigation process: One of the longest parts of the process, this step can take several weeks as the loss mitigation specialist reviews the request and begins negotiating new loan terms. It may take a week or two or even a month or two to complete – that really depends on the specialist’s case load.

• Completion of the new loan: Once the modification request is approved, the lender will send a packet to fill out and sign within 3-5 business days to complete the modification.

Getting a loan modified can take several weeks to several months to complete. The key is being pro-active and patient, all at the same time.  A foreclosure defense lawyer is necessary to handle the foreclosure case, but homeowners don’t need to hire an expensive company to do their loan modification. On the contrary, doing the loan mod, or a short sale, yourself while your attorney defends the foreclosure case may lead to a better result and thousands of dollars saved.

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