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Owe More Than Your House Is Worth and Waiting on the Bank to Threaten Foreclosue --- What Can I Do?
The United States is going through one of the worst recessions since the Great Depression. Bankruptcy filings have increased, unemployment is high and home values have decreased exponentially since 2007 highs. Many home owners are finding they have a lot of debt, a house that is not worth what they owe, no ability to refinance and no ability to sell a home because they owe more than it is worth.
It may seem like a home owner is left with no option except to quit paying their mortgage, allow a foreclosure and file bankruptcy. However, if the home owner has the ability to avoid bankruptcy if the house could go away there should be options besides bankruptcy and at Wischmeyer Law Office we help homeowners with such solutions.
First, bankruptcy is an option that allows the homeowner to keep the home. If a home owner wants to keep the home then a Chapter 13 bankruptcy can allow the homeowner to file bankruptcy, catch up on their missed payments and possibly even reduce the amount that the homeowner owes on the home. This is called a “cram down” and can have significant benefits helping a homeowner keep the home at the value that exists in today’s world.
The home owner may also be able to give the home to the bank, avoiding foreclosure, and the extra costs that often get tacked on to the mortgage because of the bank’s attorney fees, collection costs and the ongoing interest the mortgage allows the bank to collect. This process is called a Deed-In-Lieu and although bank’s put up significant barriers to avoid a deed in lieu it is possible. Sometimes the bank will ask for the homeowner to make small payments toward the difference in the home’s value and the balance of the mortgage, but an experienced attorney often can negotiate the amount of the deficiency and the payment amount and term to give the homeowner the financial relief they are seeking.
A third option is a short sale. With a short sale the homeowner obtains permission from the bank to sell the home to a third party for less than the balance owed on the home. This is not a quick process, but an experienced short sale attorney such as Jason Wischmeyer can help expedite the process by having the short sale prepared and the discussions with the bank so that when an offer is made on the home the bank has the information needed to evaluate the proposed sale and get an answer back to the homeowner on allowing the sale. At Wischmeyer Law Office we work with all sorts of Realtors and even have a Realtor on staff to help list your property and get a short sale approved.
Having financial difficulties with an underwater mortgage should not leave a homeowner with only the option of allowing a foreclosure on the bank’s terms. An experienced attorney can help facilitate some other deal with the bank, delay any foreclosure and give a homeowner the ability to feel in control of the process. Often times, if the homeowner wants the attorney and relator can help save the home.
Call us at Wischmeyer Law Office to speak with an attorney AND a Realtor about options for your home and what it is that you, as a homeowner, want to do with your help. Let us give you a solution that either saves your home or puts you back in control instead of the bank and its attorneys.
Jason P. Wischmeyer, P.O. Box 419, Shelbyville, IN 46176