For many Massachusetts residents that come to Express Bankruptcy Solutions, secured and unsecured loans have become real burden. Unexpected medical problems, a pending divorce or a recent layoff has upended their lives and can put people in financial crisis almost overnight.

When this happens, it is often difficult to keep up with monthly bills, including mortgage payments. If you have fallen behind on your mortgage and are facing the threat of foreclosure, it can cause untold amounts of stress.  The good news is that just because you have fallen behind does not mean that you will be on the streets.  It may be possible to keep your home through a mortgage loan modification. As a consequence of the foreclosure crisis of 2008 and 2009 as well as the COVID-19 pandemic of 2020, many lenders are now reaching out to debtors and letting them know help is available.

Keeping Your Home Through Mortgage Loan Modification

The attorneys at Express Bankruptcy Solutions understand that a monthly mortgage is the largest single expense for most people and is also the most important. We want you to know that you have options beyond sacrificing your home the mortgage company when you are facing a loss of income. We can assist you in obtaining a mortgage loan modification and help you regain control of your monthly mortgage payment so that you will be able to remain in your home.

Once your lender has reviewed your application and decided that you are eligible, it will require a three-month trial period.  During this trial period, you will be required to make a new reduced payment on time.  The payments during the trial period must be made before the lender makes a final determination whether your new reduced payment will become permanent.

Lowering your monthly mortgage payment can be done several different ways, a few of which include:

  • Reducing interest rates
  • Lowering monthly payments
  • Changing terms of a loan
  • Converting to a fixed rate mortgage
  • Re-amortizing mortgage payments

It is important to remember that a foreclosure is a complicated and expensive legal process for banks and lenders.  Lenders have to hire foreclosure attorneys in order to send a house to auction which is costly and time-consuming.  Lenders know that they can lose even more money if the house goes to auction as opposed to just working with a homeowner to modify their mortgage into a new payment plan.

What is an ‘Underwater’ Mortgage?

A home is considered financially “underwater” if it is worth less than what the homeowner owes on the mortgage. In an underwater situation, if a homeowner sells the property, he or she will still owe money on the loan. In cases like this a lender may be amenable to a “short sale” however, they still may lose more money than if they helped a homeowner stay in their house through a mortgage modification.  In a short sale situation, a lender would let the home be sold and would discharge the mortgage for less than what was owned.  If this has happened to you, our strategies for helping you may include negotiating a loan modification with the lender to forgive some of the principal as opposed to letting the house go to a short sale and leaving you without a place to live.

Your Lender is Not on Your Side

Although mortgage companies are willing to work with homeowners to modify their mortgages, it is important to remember that the mortgage company is not looking out for the best interests of the homeowner and is not their ally. The mortgage company’s objective is simply to mitigate any prospective losses when a borrower is unable to meet their monthly mortgage obligations.

In many cases, there can be long delays in getting the modification application processes and as a result, arrearages will continue to accrue during this time period.  It is also important to remember that the mortgage company may guide a struggling homeowner into options that better suit their bottom line, not the homeowner’s financial needs. Lenders sometimes reject modification requests altogether but having an attorney help advocate to hold the lender accountable can make a big difference. Because we prepare mortgage modification applications professionally, we already have existing relationships with many mortgage companies and their attorneys, so we know who to contact. We also can help you bypass some of the red tape that may hinder you from attempting to secure your own modification.

Express Bankruptcy Solutions is well versed in how various mortgage modification programs work and can help you understand your options. We put your interests first and work to obtain a modification or loan workout whenever possible. Our success rate in securing modifications for our clients is over 75 percent and, even in those limited times when a modification doesn’t work, we can still use Chapter 13 Bankruptcy as a back-up plan to force a re-payment plan on the mortgage company.

Secure a Fresh Start Through Bankruptcy

In some situations, a loan modification may not be an option, or a modification may be needed as part of a bankruptcy. As skilled bankruptcy lawyers, we can help.

A Chapter 13 bankruptcy filing stops the constantly ringing telephone and helps you keep your assets while only paying a portion of the debt.

If you qualify, a Chapter 7 filing can not only wipe out unsecured debt, but also loans that are secured with household items.

Many people fear that immediately following a bankruptcy filing, they will lose every possession they have. This is a myth. Bankruptcy protects you from aggressive creditors and collection actions. It is possible to keep your valuable possessions secured by loans while getting a fresh financial start.

Contact Us to Discuss Ways to Save Your Home

As Massachusetts bankruptcy attorneys, we have the skills and experience to help you modify your mortgage and stay in your home. By the end of your free consultation with us, you will have a clear understanding of what your next best steps will be to protect your assets and get a financial fresh start.

Call us at 978-851-4000 to assess your situation and guide you toward the appropriate financial solution.  We are conveniently located in Tewksbury near Rte. 93 and Rte. 495.  We service clients throughout Massachusetts.