About the Federal Loan Modification Program
In response to the economic devastation caused by the subprime mortgage crisis of 2008, the federal government created the Home Affordable Modification Program. The goal of this program is to provide homeowners who have distressed mortgages with assistance in obtaining a loan modification, which makes it easier for them to afford their monthly mortgage payments. It is run by the U.S. Department of the Treasury, and in essence, it works by offering incentives to mortgage lenders to modify distressed home loans rather than foreclose on them.
As good as this program may look on paper, it has unfortunately not worked out as well as originally intended. Homeowners attempting to take advantage of its benefits often end up bogged down in a quagmire of paperwork and bureaucratic red tape, resulting in a denial of a requested modification and the loss of their homes to foreclosure anyway. Even worse, many lenders will require a homeowner to apply through the program despite knowing that they won't qualify simply so that they can report to the government that they made an effort to help the borrower before moving forward with foreclosure.
How a Jacksonville Foreclosure Defense Attorney Can Help?
The good news is that even if the federal government's attempt to make loan modifications is less than perfect, it is still possible to pursue this course of action as a viable approach to preventing a foreclosure of your home. You can hire a Jacksonville foreclosure defense attorney from The Law Offices of Justin McMurray, P.A. to represent you in mortgage modification negotiations with the bank in an effort to have your interest rate or the remaining principal of the loan reduced or to have the term of the loan extended.
The end result is that your mortgage payment would be reduced to an amount that you can afford, so that you can keep your home and avoid the serious credit consequences of foreclosure. You might wonder why a bank would be willing to approve a request for a loan modification instead of simply foreclosing on the mortgage and selling the property to another buyer. The fact is that it is in the best interest of the bank to avoid foreclosure, even if they don't always see this at first. A 2007 report to the U.S. Senate estimates that a bank will lose $50,000 on the average foreclosure, a figure which includes legal costs and the lost revenues while the loan is in default and while the property is waiting to be sold. In many cases, the amount the bank would lose by agreeing to a loan modification would be far less than the costs of a foreclosure. Our firm has had success with almost every bank and lender in the field, and we are ready to begin working on your case immediately. Contact a lawyer free case evaluation!