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Mortgage Loan Modification; A Tool Used to Save Your Home Through Bankruptcy

In Chapter 7 and Chapter 13 bankruptcy a formal process of court monitored mortgage modification has been instituted which forces lenders to act in good faith in processing requests for mortgage modification. In this regard foreclosure can be averted by arriving at a post-bankruptcy monthly mortgage payment that fits within your budget after all other debts have been discharged or adjusted. Mortgage Loan Modification, which lower interest rates and/or reschedule and extend past due principal or interest debts, is a method by which your mortgage payment may be reduced so as to maximize the potential of saving your home. Most of you who have tried to negotiate a mortgage modification outside of bankruptcy- either alone or with the help of an attorney or paid consultant- have not been successful. In fact, my experience is that by the time a mortgage review can be completed the home is inevitably lost to eventual foreclosure. Lenders are notorious for claiming that modification support documents submitted by borrowers have been “lost” or “not received”, or claim that borrowers have not “timely” sent all documents required for a review, thereby resulting in all documents having to be updated and resubmitted again, and again and again. I have seen this process go on for up to a year, only resulting in rejection!

This game of obstruction or incompetence by lenders, whichever applies, results in a never ending round- robin of “its lost”, “not received” or “expired”. I have found that most often before a loan modification determination has been rendered the borrower either gives up in disgust and frustration or falls so far behind in payments that it becomes impossible to ever catch up, even if loan modification is approved (which it very very rare).

The US Bankruptcy Court has recognized this bad faith pattern by mortgage lenders and has thus instituted a formal process by which bankruptcy attorneys can force mortgage lenders to submit to court monitoring of the mortgage modification process. If you file bankruptcy and need a mortgage modification to keep your home the courts watchful eye can assure that your application is properly submitted, evaluated and timely determined, thereby maximizing the potential of saving your home and lowering/extending your mortgage payments.

Bankruptcy is a tool which can be used as a shield or a sword; it can save your home or business, modify loan or debt payments, and discharge unwanted debt. Bankruptcy when properly used by an experienced bankruptcy lawyer can allow you to enjoy life right now, and enter retirement with minimal or no debt.

To learn more about the fundamentals of bankruptcy call David Stone, Esq. and the South Carolina Bankruptcy Network right now, 7 days a week, for a FREE consultation and also visit our website.

– See more at: We always provide a FREE consultation so you may learn your rights. Call right now: (843)422-9414.

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